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Federal judge denies request for discovery stay in Chevron RICO case

By Jessica M. Karmasek | Jun 26, 2013

NEW YORK (Legal Newsline) -- A federal judge this week denied a request by New York attorney Steven Donziger for a discovery stay in a fraud case filed by Chevron Corp. against him and two Ecuadorian rainforest residents.

Judge Lewis Kaplan for the U.S. District Court for the Southern District of New York wrote in a four-page order Tuesday that the court "sees no need" for immediate relief to stay the completion of a few depositions pending its ruling on Donziger's requested three-month stay.

"Nor is there any satisfactory reason to hold up the Court's resolution of the few remaining discovery disputes," Kaplan wrote. "Despite repeated instruction from the Court that any stay application must supported by evidence, Donziger has failed to submit a single sworn affidavit or piece of evidence showing that he would be prejudiced absent further interim relief.

"Accordingly, the request for 'an immediate protective order staying the progress of discovery in this case until such time as the Court can rule on [the Donziger defendants'] earlier request for relief is denied."

Donziger filed a motion earlier this month asking Kaplan to grant a three-month stay to prevent the case from "devolving into a mockery of justice and due process."

"The breakneck pace of Chevron's continued legal onslaught since withdrawal of my former counsel is severely prejudicing my ability to defend myself," he wrote in his motion, originally filed June 1.

Last month, Kaplan allowed the law firms defending Donziger, Javier Piaguaje and Hugo Camacho to withdraw from the fraud case, filed by the oil giant in the New York federal court in 2011.

Lead attorneys John Keker of San Francisco-based Keker & Van Nest and Craig Smyser of Houston-based Smyser Kaplan & Veselka argued that the judge's ongoing bias in the case and Chevron's litigation tactics have made it impossible for their clients to pay their legal bills.

Keker, who also was the attorney for prominent Mississippi attorney Richard "Dickie" Scruggs during two judicial bribery cases, was representing Donziger in the case.

On June 7, and before Chevron had responded to Donziger's motion, Donziger filed another motion, this time seeking an immediate protective order staying the progress of discovery until the court can rule on his earlier request.

"Not only is discovery virtually complete, but there is not much more to do in the immediate future except to prepare for trial," Kaplan said of his decision.

"The date for filing the joint pretrial order, which had been June 30, 2013, recently was extended until July 30, 2013 to accommodate defendants. Trial does not begin until Oct. 15, 2013. Thus, the defendants will have approximately three and one-half months between the completion of the last deposition and the commencement of the trial within which to complete their preparations.

"Indeed, as recently as May 20, 2013, Mr. Donziger stated that he wished to proceed on that date. Although it appears that he has changed his mind."

Kaplan said in his order this week that he will issue a decision on Donziger's motion for a stay of the trial "as promptly as is practicable in all of the circumstances."

Without the requested three-month stay, Donziger argues he will not be prepared for trial, his interests will be "severely prejudiced," and he fears "manifest injustice" will result.

"I remind the court that Chevron is seeking treble damages against me on the $19 billion underlying judgment from the courts of Ecuador. The potential liability against me in this case, if it were to be realized, would be devastating to me and my family," he said. "Even without a finding of liability, the legal fees in defending against this lawsuit -- for which I am liable personally -- threaten to bankrupt me."

Click here to read Kaplan's full order.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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