Chevron Corp. v. Republic of Ecuador, No. 12-1247 (D.D.C. Oct. 29, 2013) [click for opinion]
The District Court for the District of Columbia confirmed a $100 million arbitration award in favor of Chevron and against Ecuador. But because Ecuador did not have substantial assets in the District of Columbia, Chevron filed a motion to enable it to register the award "in any other district" in the country pursuant to 28 U.S.C. § 1963. Ecuador objected, arguing that Chevron should be permitted to register the award only in “those districts for which Chevron has provided sufficient evidence that Ecuador has substantial assets.”
Because Ecuador’s appeal of the district court's confirmation of the arbitration award was pending, the district court could allow registration outside of the awarding district only for “good cause shown.” “Good cause” can be established by showing 1) an absence of assets in the judgment forum and 2) the presence of substantial assets in the registration forum.
There was no question that Ecuador lacked sufficient assets in the District of Columbia. The parties disagreed, however, over whether Chevron was required to demonstrate that Ecuador has substantial assets in a particular forum or whether proof of substantial assets in any U.S. forum would be sufficient. The court sided with Chevron and ruled that Chevron need only show that Ecuador has substantial assets in any forum. This test would be particularly applicable, the court thought, in cases where the target assets could be moved from district to district in an effort to avoid attachment.
Ecuador argued that the court’s decision would subject it to subpoenas in 93 judicial districts. The court observed that Ecuador would need to respond only in those districts where Chevron found assets. “At the end of the day," the court wrote, "national registration makes more sense in a case of mobile assets than does Ecuador’s hide-and-seek proposal.” Accordingly, the court granted Chevron’s motion to register its award in "any other judicial district."