Chevron Warned Not To Use Windfall Profits For Ballot Measure Eliminating Its Liability For Punitive Damages In MTBE Cases

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Santa Monica, CA — The Foundation for Taxpayer and Consumer Rights sent the following letter today to the Board of Directors of Chevron:

March 2, 2006

David J. O’Reilly
Chief Executive Officer and Chairman of the Board
Chevron Corporation
6001 Bollinger Canyon Rd.
San Ramon, CA 94583

Dear Mr. Reilly,

We are deeply disturbed to find that shortly after recording the highest annual profits in the company’s 126 year history, Chevron intends to use some of its $14.1 billion in 2005 profits to remove itself from accountability to taxpayers for polluting the environment and to upend the California system of jurisprudence.

As your company acknowledged today in the Los Angeles Times, Chevron is leading a November 2006 ballot measure campaign to eliminate punitive damages when a company’s product is subject to government regulation in order to remove Chevron from legal accountability for its contamination of the ground water with MTBE.

Chevron should not be using its windfall profits to change the rule of law so that the company can avoid the wrath of juries that find it acted with malice and oppression — the standard to obtain punitive damages in California. If juries are convinced the company knew MTBE would cause grave harm to the water supply, but chose to use the additive rather than ethanol anyway, then Chevron should submit to their will.

Chevron‘s pending initiative makes the best case for a strong windfall profits tax. If Chevron is to use its windfall profits for a massive political propaganda campaign aimed at putting itself above the rule of law, why should it be permitted to make such outrageous sums at the expense of the American motorist and economy?

Companies with as much money as yours often forget that there are some things they cannot buy. The rule of law is one of them.

Be advised. Taxpayers, represented by their water districts, who have sued Chevron for contaminating their water supply have a right to punish the company for its malice. The company should not underestimate the damage to its brand when the facts of this ballot war’s self-serving nature come into focus for more and more Californians.

As a board member for Chevron, you should consider whether such a course is truly in the long-term interests of this company.


Jamie Court

Consumer Watchdog
Consumer Watchdog
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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