Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_99-cv-02506/USCOURTS-cand-3_99-cv-02506-29/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 18:1962 Racketeering (RICO) Act

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United States District Court

For the Northern District of California

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In 2001, Chevron merged with Texaco to form ChevronTexaco Corporation. On May 9, 2005,

the company announced that it was changing its name back to Chevron Corporation. This Court’s past

orders have referred to both ChevronTexaco and Chevron as the same entity.

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

LARRY BOWOTO, et al.,

Plaintiffs,

 v.

CHEVRON CORP., et al.,

Defendants. /

No. C 99-02506 SI

ORDER GRANTING IN PART

PLAINTIFFS’ MOTION FOR LEAVE TO

FILE EIGHTH AMENDED COMPLAINT

AND DENYING PLAINTIFFS’ MOTION

IN LIMINE FOR APPLICATION OF

JUDICIAL AND/OR EQUITABLE

ESTOPPEL

On February 24, 2006, the Court heard argument on plaintiffs’ motion for leave to file an eighth

amended complaint and motion in limine for application of judicial and/or equitable estoppel. Having

carefully considered the arguments of counsel and the papers submitted, and for good cause shown, the

Court hereby GRANTS IN PART plaintiffs’ motion for leave to file an eighth amended complaint, and

DENIES plaintiffs’ motion in limine, for the reasons set forth below.

BACKGROUND

Plaintiffs filed this action in 1999, seeking damages for a series of brutal attacks in Nigeria that

they allege were connected to Chevron’s oil operations on the Niger River Delta. Unable to sue the

Chevron entity they allege was directly involved, Chevron Nigeria Limited (“CNL”), plaintiffs brought

suit against Chevron Corporation (“Chevron”).1

 In 2002, this Court granted plaintiffs leave to amend

their complaint to include claims against ChevronTexaco Overseas Petroleum, Inc. (“CTOPI”), now

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Except where otherwise indicated, this order will refer to the parent company of CNL as CII.

The abbreviations used to refer to the various Chevron entities that are relevant to this case are quite

confusing because many of those entities have undergone numerous name changes over the past ten

years. The situation is made all the more confusing because these entities have frequently held names

that are virtually identical. For example, the Chevron subsidiary that was added as a defendant in

plaintiffs’ fourth amended complaint was CTOPI. At the same time, however, there was another

Chevron subsidiary in existence named ChevronTexaco Overseas Petroleum – “CTOP.” Confusion

caused by these two entities’ names caused the Court to refer to CTOPI as CTOP in in its order granting

plaintiffs leave to file their fourth amended complaint.

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In actuality, the supplement changed “COPI” – Chevron Overseas Petroleum, Inc., the name

for CII at that time – to “CUSA/COP.” CUSA/COP refers to CUSA and Chevron Overseas Petroleum,

a division of CUSA under Pennsylvania corporate law. See Soler Decl., ¶ 8.

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CUSA is incorporated under Pennsylvania law, which allowed corporations to create divisions

without separately incorporating. CUSA’s division COP was created on January 1, 1994, apparently

to take over the functions of pre-1995 COPI. This order uses “CUSA” to refer to both CUSA and its

division COP.

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named Chevron Investments, Inc. (“CII”), an American subsidiary of Chevron that is the parent

company to CNL.2

The instant dispute began on July 15, 2005, only a few months before the end of discovery, when

defendants produced supplemental responses to plaintiffs’ interrogatories, changing many answers that

defendants claimed named the wrong entity. Although many of defendants’ original answers had

referred to actions taken by CII personnel, defendants’ supplemental responses contended that these

individuals had actually worked for Chevron U.S.A., Inc. (“CUSA”), an American subsidiary of

Chevron that had no ownership interest in CNL. The majority of defendants’ changes simply substituted

CUSA for CII in the interrogatory responses.3 In other instances, however, defendants deleted

references to CII from their responses. During depositions in September and October, witnesses

produced by defendants explained that during the relevant time period CII had been a holding company

with officers and directors but no employees. They also explained that, given the similarity of names

between Chevron subsidiaries, many employees were confused about the true name of their employer.

In their motion, defendants have explained to the Court the organization of the relevant Chevron

entities for the first time. Three entities are relevant to this motion: (1) the original Chevron subsidiary

named Chevron Overseas Petroleum, Inc. (“Pre-1995 COPI”); (2) CUSA and its division, Chevron

Overseas Petroleum (“COP”)4

; and (3) CII, frequently referred to as Chevron Overseas Petroleum, Inc.

(“COPI”), because that is the name it held when the Nigerian attacks allegedly took place. The precise

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This counsel and service agreement may be a large part of the basis for the confusion. Because

it was executed in 1987, the agreement states that one of the parties is “Chevron Overseas Petroleum,

Inc.” Mitchell Decl., Exh. 3. Plaintiffs have been operating under the assumption that this is the same

entity as the COPI that existed between 1995 and 2001. As described above, given that the agreement

was assigned to CUSA, and given the various name changes that occurred, plaintiffs were incorrect; Pre1995 COPI is the entity named in the agreement.

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relationship between these entities is as follows.

From 1968 through December 31, 1994, Pre-1995 COPI existed to provide services to Chevron’s

foreign subsidiaries. Soler Decl., ¶ 14; Matzke Decl. at ¶ 2. Over the course of 1994, however, Pre1995 COPI assigned to CUSA its “counsel and service” agreements with Chevron’s foreign subsidiaries,

including one such agreement with CNL.5

 At the end of 1994, Pre-1995 COPI merged with CUSA and

ceased to exist. Soler Decl., ¶ 15. At that time, all employees and officers of Pre-1995 COPI became

employees and officers of CUSA and its division, COP. Matzke Decl. ¶ 3. From 1995 forward, COP

carried out the functions that Pre-1995 COPI had performed.

The day after this merger, on January 1, 1995, CII (then named Transocean Chevron Company)

changed its name to Chevron Overseas Petroleum, Inc. (“COPI”). Soler Decl., ¶ 5. On October 10,

2001, COPI was renamed CTOPI, and on June 18, 2005, it was renamed CII. Id. at ¶ 4. From 1995

through 2000, during which it was known as COPI, CII was a holding company whose primary purpose

was to own other Chevron subsidiaries, one of which was CNL. Id. at ¶ 7. According to defendants,

CII had officers and directors, but no employees, during this time period. Id.

CUSA has had the same legal name since at least 1986. Id. at ¶ 8. A division of CUSA,

however, has changed names in virtual lock step with CII. From its inception in 1994 until 2001,

covering the time CII was named COPI, CUSA’s division was named COP. Following the 2001 merger

with Texaco, COP was renamed Chevron Texaco Overseas Petroleum (“CTOP”). At the same time,

COPI became CTOPI. On May 9, 2005, CTOP was renamed Chevron International Exploration and

Production Company, the name it holds today.

As mentioned above, the similarity of names and acronyms has caused considerable confusion

to the witnesses, the parties, and the Court. This confusion has been exacerbated by CUSA’s business

decision in 1995 to have employees continue to refer to their employer as “COPI” and to use “COPI”

letterhead on memos and letters in order to take advantage of goodwill associated with the name

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“COPI,” even though that name was technically incorrect. Id. at ¶ 4.

The above confusion came to a head in 2002, when plaintiffs sought to amend their complaint

to include CII as a defendant. Because plaintiffs understood CII and COP to refer to the same entity,

they did not attempt to include CUSA as a defendant. Plaintiffs contend that they only learned of this

error when served on July 15, 2005, with “Defendants’ Consolidated Supplemental Response to

Plaintiffs’ Phase I Interrogatories,” which changed many of the interrogatory responses defendants had

provided between 2001 and 2003. These changes replaced the term “COPI” with “CUSA/COP” as the

employer of certain key personnel, renamed CII divisions as departments within CUSA, and removed

the words “by agreement with COPI” in several responses that previously indicated that CUSA

performed certain services for CNL only through agreement with CII.

Based on this dramatic change in defendants’ story, plaintiffs bring two motions before the

Court. First, plaintiffs request leave to file an eighth amended complaint to include CUSA as a

defendant. Second, plaintiffs request that the Court estop defendants from attributing actions to CUSA

that had previously been attributed to CII.

LEGAL STANDARD

I. Leave to Amend

Federal Rule of Civil Procedure 15 governs the amendment of complaints. It provides that if

a responsive pleading has already been filed, the party seeking amendment may amend the its pleading

only by leave of court or by written consent of the adverse party. Fed. R. Civ. P. 15(a). The rule reflects

an underlying policy that disputes should be determined on their merits, and not on the technicalities

of pleading rules. See Foman v. Davis, 371 U.S. 178, 181-82 (1962). Thus, courts should grant leave

to amend with “extreme liberality.” See Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051

(9th Cir. 2003).

Leave to amend is not automatic, however. There are several accepted reasons why leave to

amend should not be granted, such as the presence of bad faith on the part of the plaintiff, undue delay,

prejudice to the defendant, and futility of amendment. See AmerisourceBergen Corp. v. Dialysist West,

Inc., 445 F.3d 1132 (9th Cir. 2006). One reason that an amendment may be futile is that the claim it

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raises is barred by the statute of limitations. See Deutsch v. Turner Corp. 324 F.3d 692, 718 n.20 (9th

Cir. 2003).

II. Judicial Estoppel

“Judicial estoppel, sometimes also known as the doctrine of preclusion of inconsistent positions,

precludes a party from gaining an advantage by taking one position, and then seeking a second

advantage by taking an incompatible position.” Wagner v. Prof. Eng. in Cal. Gov’t, 354 F.3d 1036,

1044 (9th Cir. 2004). It is an equitable doctrine that is intended to protect the integrity of the judicial

process by preventing a litigant from “playing fast and loose with the courts.” Russell v. Rolfs, 893 F.2d

1033, 1037 (9th Cir. 1990). The United States Supreme Court has identified three non-exclusive factors

that courts should consider in determining whether to apply the doctrine of judicial estoppel:

First, a party’s later position must be “clearly inconsistent” with its earlier position. . . .

Second, courts regularly inquire whether the party has succeeded in persuading a court

to accept that party’s earlier position, so that judicial acceptance of an inconsistent

position in a later proceeding would create “the perception that either the first or the

second court was misled.” Absent success in a prior proceeding, a party’s later

inconsistent position introduces no “risk of inconsistent court determinations,” . . . and

thus no threat to judicial integrity. A third consideration is whether the party seeking to

assert an inconsistent position would derive an unfair advantage or impose an unfair

detriment on the opposing party if not estopped.

New Hampshire v. Maine, 532 U.S. 742, 121 S.Ct. 1808, 1815, 149 L.Ed.2d 968 (2001) (citations

omitted).

III. Equitable Estoppel

The traditional elements of equitable estoppel are: “(1) the party to be estopped knows the facts;

(2) the party intends that his or her conduct will be acted on; (3) the claimant must be ignorant of the

true facts; (4) and the claimant must detrimentally rely on the other party’s conduct.” Salgado-Diaz v.

Ashcroft, 395 F.3d 1158, 1166 (9th Cir. 2005).

DISCUSSION

As mentioned above, plaintiffs move to amend their complaint to add CUSA as a defendant.

Plaintiffs also seek to preclude defendants from attributing conduct to CUSA that they previously

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attributed to CII. Before discussing the merits of these motions, the Court will describe the relevant

discovery responses and defendants’ recent changes.

I. Discovery Responses at Issue

Before they filed their supplemental interrogatory responses, defendants had produced a

substantial amount of discovery in this case that indicated that the actions defendants now claim were

taken by CUSA were actually taken by CII. The amount of mistaken discovery that plaintiffs point to

is considerable, and includes documents, interrogatory responses, and deposition testimony. The

following are representative examples of defendants’ mistaken discovery: 

C On May 21, 2001, defendants served interrogatory responses identifying CII as the

owner of CNL. Pl. Exh. 2 at 8-11. These responses also indicated that CII had provided

technical, professional, and administrative services to CNL, or that it had authorized

CUSA to do so. For example, one interrogatory response stated that “[t]he authority to

make certain [Foreign Corrupt Practices Act] compliance determinations . . . has been

delegated to COPI’s Finance Department” and that “by agreement with COPI, these job

functions are carried out by certain U.S.-based employees of CUSA/COP.” Pl. Exh. 2

at 47. On July 15, 2005, defendants changed this and other similar answers to remove

the words “by agreement with COPI,” and by changing “COPI” to “CUSA/COP,”

negating CII’s role. Pl. Exh. 28 at 3.

C On December 7, 2001, defendants served supplemental interrogatory responses

identifying a number of CII employees during the relevant period. The interrogatories

name both “Joe Lorenz of COPI’s Public Affairs Department” and “Brian Kay of COPI”

Pl. Exh. 3 at 15, 19. On July 15, 2005, defendants replaced both references to “COPI”

with “CUSA/COP.” Pl. Exh. 28 at 3.

C In a February 7, 2002, deposition, Chevron executive Thomas Schull described how he

and another CII employee moved from CII to CNL and back to CII over the course of

their careers, at the behest of CII executives. Pl. Exh. 5 at 31-34, 84-87. Schull

described a position in Nigeria as typically a four-year assignment, after which the

employee would return to CII. Id. at 86-87. During the deposition, Schull repeatedly

referred to his employer as “COPI.”

C In February 28, 2002, interrogatory responses, Chevron identified twelve individuals as

being “COPI” employees during years after 1995, in roles including human resources,

facilities engineering, and vice-president for various “COPI” divisions. See Pl. Exh. 8

at 2-7. Chevron’s July 15, 2005, supplemental interrogatory responses changed every

reference to “COPI” to “CUSA/COP.” Pl. Exh. 28 at 4.

C In an April 9, 2002, deposition, Scott Davis, a CNL employee who allegedly was part

of the decision to send the military to Parabe in 1998, explicitly testified that he worked

for COPI while based in the U.S. Indeed, Davis testified that an interrogatory answer

that identified him as a CUSA employee during that period was “incorrect.” Pl. Exh. 6

at 16. Mr. Davis also testified about a document that offered to transfer him to CNL.

Id. at 16:8-17:9. That document, a “fixed duration assignment offer,” has the acronym

“COPI” printed in large type at the top, states that the offer is from “Chevron Overseas

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Petroleum, Inc.,” that it was prepared on December 17, 1996, and that the completed

form should be returned to “COPI HR” by December 27, 1996. Pl. Exh. 7.

C On October 1, 2002, defendants sent a letter brief to the Court describing an attached

exhibit as “a fax sent by a CTOP employee in Washington to two CTOP employees in

the United States and a CNL employee in Nigeria.” Pl. Exh. 10. Although defendants’

letter brief used the correct acronym “CTOP,” the letter brief indicated at its beginning

that “CTOP” represented “ChevronTexaco Overseas Petroleum Inc.” In addition, the

fax was sent with a COPI cover sheet. Pl. Exh. 10.

C In a November 19, 2002, deposition, Thomas W. Harrison described himself as a former

Manager of Drilling Operations International at CII and detailed how daily drilling

reports were sent from CNL to CII for review by CII staff. Pl. Exh. 13 at 29-31, 37-38,

121-22.

C In a January 7, 2003, deposition, James Bates, manager of Chevron’s Nigerian business

unit, testified that he supervised a team of CII engineers and earth scientists. When asked

who his employer and the employer of the engineers and scientists was, Bates responded

“COPI, Chevron Overseas Petroleum, Inc.” Pl. Exh. 16 at 40-41.

C On May 26, 2005, defendants responded to an interrogatory which asked them to “set

forth the purpose and function of the Nigeria Strategic Business Unit located in San

Ramon, as well as the nature of its organizational relationship to other CHEVRON

ENTITIES during the period from January 1, 1994 through January 31, 2000.”

Pl. Exh. 25 at 79. Defendants’ response referred plaintiffs to an organizational chart that

showed this business unit as being a part of “Chevron Overseas Petroleum, Inc.”

Pl. Exh. 25 at 79; Pl. Exh. 26.

As the above examples illustrate, defendants have produced a formidable amount of discovery

in this action that directly contradicts their current position that CII was nothing more than a holding

company during the relevant time period. These examples are only a selection of the discovery

produced by defendants that identifies CII employees and describes CII’s ongoing relationship with

CNL. Numerous other examples exist in which witnesses characterize themselves as CII employees and

describe CII as having provided personnel, administrative, planning, technical and oversight services

to CNL. There are also numerous instances in which plaintiffs’ counsel asked a witness to confirm the

name of his or her employer and the answer was “COPI.”

Defendants attempt to justify the erroneous discovery by arguing that they provided plaintiffs

with other discovery sufficient to make plaintiffs aware of Chevron’s corporate structure. Defendants

claim that documents they produced reveal that Pre-1995 COPI merged with CUSA and that CUSA was

involved in managing the business and assets of CNL following the merger. For example, defendants

produced the articles of merger between Pre-1995 COPI and CUSA; an agreement assigning Pre-1995

COPI’s contract with CNL to CUSA; payroll records showing that “811 CHEVRON OVERSEAS

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PETROL DIV/CUSA” or “811 CHEVRON OVERSEAS PETROLEUM (COP),” and not “COPI,” paid

the salaries of CNL employees; and accounting records showing debts and payments between CNL and

CUSA. See Def. Exhs. 7, 11, 12; Matke Decl., Exh. 1; Soler Decl., Exh. 10.

While the discovery defendants point to accurately reflects the corporate relationships between

Chevron, CUSA, and CII, it is insufficient to overcome the misleading discovery responses described

above. The reason for many of plaintiffs’ discovery requests was to learn which Chevron entity assisted

CNL with planning and decision making. Defendants’ erroneous discovery responses bear directly on

that issue, while the correct discovery defendants point to does not. For example, some of the documents

pointed to by defendants merely show that COPI and CUSA are separate entities, which has never been

in question. See Def. Exhs. 7, 14, 15. The assignment agreement and articles of merger only show that

a corporation called COPI assigned its counsel and service agreements to CUSA in 1995 pursuant to

a merger in which CUSA was the surviving entity. Matzke Decl. Exh. 1; Soler Decl. Exh. 10. These

documents are not inherently inconsistent with the far-more-explicit statements of numerous individuals

that they worked for an entity called “COPI” that did a variety of work for CNL after 1995.

The accounting records defendants produced suffer from the same lack of illumination. For

example, defendants highlight an entry in a spreadsheet entitled “Intercompany Capital Contributions

(Returns of Capital)” that reads “April ‘94 asset tsfr. from COPI to COP-CUSA Division.” Def. Exh. 9.

But this entry gives no insight into the respective roles that CII and CUSA played in the support and

management of CNL. More importantly, the accounting records have contributed to the confusion in

this case. When plaintiffs propounded an interrogatory asking what the code “811” on the payroll

records referred to, the response was “COPI or CTOP.” Pl. Exh. 18 at 6. Defendants argue that any

confusion was remedied during the March 4, 2003, deposition of Rick Brown. At his deposition, Brown

testified that employees of foreign subsidiaries paid in U.S. dollars were initially “on COPI’s payroll,”

but were later transferred to the payroll of a new entity called “COP.” Def. Exh. 20. Brown, however,

provided very few details about the transfer. His testimony was certainly not detailed enough to be

viewed as more accurate than defendants’ interrogatory responses or the sworn testimony of others that

they performed work for CNL while employed by “COPI.”

Defendants also argue that some interrogatory responses provided in May 2001 adequately

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showed plaintiffs the relationship between CUSA, CII, and CNL. These responses indicated that CUSA

employees were involved in Foreign Corrupt Practices Act compliance “by agreement with COPI”; that

CUSA provided payroll services to CNL “by agreement with COPI”; that CUSA had U.S.-based

employees whose jobs related to the maintenance and supervision of CII’s international investments;

and that two of the primary individuals involved in the Parabe and Opia/Ikenyan incidents, Thomas

Schull and Scott Davis, were employees of CNL and CUSA from 1995-2000. Def. Exh. 16 at 11, 47,

60.

However, defendants’ interrogatory responses are insufficient to have educated plaintiffs about

the roles of CUSA and CII in relation to CNL. Although the responses from May 2001 may have given

plaintiffs notice that they might have a claim against CUSA, virtually all of the discovery that followed

undercut this proposition, as deposition after deposition led plaintiffs to the reasonable conclusion that

the Chevron employees involved in the Nigeria incidents were CII employees, not CUSA employees.

The May 2001 interrogatory responses do not contradict this conclusion; the fact that CUSA is listed

as providing services to CNL would not have meant CII could not also be providing any number of other

services to CNL, a conclusion fully supported by subsequent discovery. Furthermore, the listing of

Schull and Davis as CUSA employees was later contradicted by the CII document transferring Davis

to CNL, and by their depositions, in which both characterized themselves as CII employees. Indeed,

Davis was explicitly told of the interrogatory response that lists him as a CUSA employee and he

responded “that is incorrect,” stating that he had never worked for CUSA. Pl. Exh. 6 at 16:2-17. 

The Court finds defendants’ conduct to be troubling. The discovery outlined above contains

repeated instances in which defendants incorrectly identified the relevant corporate actor. These

mistakes were not limited to employees’ deposition testimony, which might be somewhat

understandable, but also occurred throughout defendants’ interrogatory responses. Indeed, defendants’

supplemental interrogatory responses changed “COPI” to “CUSA/COP” more than twenty times. 

Of even greater concern to the Court, however, is the strong suggestion that defense counsel

knew that both plaintiffs and the Court misunderstood Chevron’s corporate structure, yet failed to

correct these misunderstandings for years. Defendants’ opposition brief admits that, in its

understanding, its interrogatories had “clearly draw[n] a distinction between [CUSA and COPI]” as far

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back as 1999. Def. Oppo. Br. at 6. Further, during a February 2002 deposition defense counsel revealed

that he understood the difference between CUSA and CII. Mitchell Decl., Exh. 2, at 121 (defense

counsel stating during a deposition that he did not think “COP refers to COPI” yet failing to elaborate

despite plaintiffs’ counsel’s clear confusion).

Despite their superior knowledge, defense counsel chose not to inform plaintiffs or this Court

of the confusion, although they were presented with numerous opportunities to do so. Indeed, this

Court’s summary judgment order, which issued over two years ago, is replete with references to actions

taken by CII, actions that defendants now claim were taken by CUSA. The instant motion, however,

is the first that the Court has heard of its misunderstanding. Even setting aside the question of whether

defendants had a duty to promptly correct the discovery responses they provided to plaintiffs’ counsel,

defendants had an obligation to clarify the misunderstanding of this Court.

Defendants justify their belated disclosure of this information by arguing that they were merely

“supplementing” their discovery responses in compliance with this Court’s deadline. Referring to

defendants’ July 15, 2005, corrections as “supplements,” however, is disingenuous. When defendants

learned that their discovery responses were incorrect, and especially when they saw that their errors

were affecting this Court’s understanding of the issues, they had a duty to promptly issue corrections.

Allowing this litigation to proceed, while the opposing party and the Court suffered from an obvious

misunderstanding, was not acceptable. 

II. Leave to Amend

In light of defendants’ erroneous discovery responses and the effect they have had on this

litigation, plaintiffs move to amend their complaint. Plaintiffs seek to add CUSA as a defendant to their

three general classes of state and federal causes of action: (1) their causes of action under the Alien Tort

Statute (“ATS”) and Torture Victim Protection Act (“TVPA”); (2) their cause of action under the federal

Racketeer Influenced and Corrupt Organizations Act (“RICO”); and (3) their other state law causes of

action.

Defendants do not oppose plaintiffs’ motion for leave to amend to the extent it seeks to add

CUSA as a defendant to claims brought under the ATS or TVPA, as the statute of limitations on those

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Although they are traditionally distinct doctrines, in the limitations context equitable estoppel

has been equated with fraudulent concealment. See Thorman v. Am. Seafoods Co., 421 F.3d 1090, 1094

(9th Cir. 2005); Santa Maria v. Pacific Bell, 202 F.3d 1170, 1176-1177 (9th Cir. 2000); see also

Guerrero v. Gates, 442 F.3d 697,706 (9th Cir. 2006) (“Equitable estoppel, also termed fraudulent

concealment, halts the statute of limitations . . . .”). The legal standard for fraudulent concealment,

however, is stated in a slightly different manner. See, e.g., Thorman, 421 F.3d at 1094. To establish

fraudulent concealment, a plaintiff must establish (1) that the defendant “affirmatively misled” him as

to the operative facts that gave rise to his claim, and (2) that the plaintiff “had neither actual nor

constructive knowledge” of these operative facts despite his diligence in trying to uncover them. Id.

Because plaintiffs frame their arguments under the equitable estoppel standard, the Court will

apply the framework for equitable estoppel. Although defendants’ argue primarily in terms of

fraudulent concealment, their arguments focus on plaintiffs’ alleged actual or constructive knowledge

of their claim against CUSA. Because such knowledge would also prevent the application of equitable

estoppel, defendants are not prejudiced by adoption of the framework advanced by plaintiffs. See Towne

v. Robbins, 339 F. Supp. 2d 1105, 1117 (D. Or. 2004). 

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claims has not yet run. Defendants, however, contest plaintiffs’ motion as to their causes of action under

RICO and California state law, claiming that they are time-barred. Plaintiffs concede that, without

tolling, the California and RICO claims were due to be filed by May 27 and 28, 2002, respectively, but

advance three arguments as to why they should nevertheless be allowed. Specifically, plaintiffs argue

that: (1) defendants should be equitably estopped from raising a statute of limitations defense; (2) the

limitations period for the California and RICO claims should be equitably tolled; and (3) the proposed

amendment relates back under Federal Rule of Civil Procedure 15(c).

A. Equitable Estoppel

Equitable estoppel can excuse the failure to file a claim within the applicable statute of

limitations when the defendant’s actions have prevented the plaintiff from filing suit in a timely

manner.6

 See Santa Maria v. Pacific Bell, 202 F.3d 1170, 1176 (9th Cir. 2000). “A finding of equitable

estoppel rests on the consideration of a non-exhaustive list of factors, including: (1) the plaintiff’s actual

and reasonable reliance on the defendant’s conduct or representations, (2) evidence of improper purpose

on the part of the defendant, or of the defendant’s actual or constructive knowledge of the deceptive

nature of its conduct, and (3) the extent to which the purposes of the limitations period have been

satisfied.” Id. This list of factors is not exhaustive, and “[w]hether other considerations are relevant

to a claim of equitable relief should be determined on the basis of the facts of each case.” Naton, 649

F.2d at 696 n.5.

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1. Reliance upon Defendants’ Representations

There can be no doubt that plaintiffs actually relied on the numerous misstatements and errors

that were contained in defendants’ discovery responses; plaintiffs’ reliance is clear from their decision

to include only CII as a defendant in their fourth amended complaint. Defendants certainly provide no

convincing strategic reason for plaintiffs’ decision not to sue CUSA. This Court’s order granting

plaintiff’s motion for leave to file a fourth amended complaint also demonstrates plaintiff’s reliance on

defendants’ discovery responses. In that order the Court explicitly referred to discovery responses

indicating that CII employees were involved in the decision to enlist the aid of the Nigerian military:

“In particular, plaintiff learned that [CII] wholly owned Chevron Nigeria, Ltd. and funded its capital

budget; that [CII] management was involved in decision making concerning events at issue, particularly

the decision to seek assistance from the Nigerian military; and that [CII] may have made some of the

public statements upon which plaintiffs’ Kasky claim rests.” Order Granting in Part and Denying in Part

Plaintiff’s Motion to File Fourth Amended Complaint (Docket No. 204), at 10. The argument on

defendant’s 2004 motion for summary judgment similarly demonstrates plaintiff’s misunderstanding.

There, the Court accepted plaintiffs’ argument that Chevron and CII could be held liable for CNL’s

actions, relying in large part on evidence of CII’s close relationship with CNL. In short, it is clear to

the Court that, until July 15, 2005, plaintiffs honestly and actually believed that CII had taken many of

the actions that defendants now attribute to CUSA.

The Court also finds that plaintiffs’ reliance was reasonable. As described above, discovery

produced by defendants over the course of years identified specific CII personnel and stated that CII

employees played a role in a broad spectrum of CNL’s operations. The sporadic instances in which

defendants correctly described the relationship between CII and CUSA, much of which consists of

relatively cryptic statements, is simply insufficient to overcome the effect of the specific and detailed

discovery that erroneously described CII’s relationship to CNL.

Accordingly, the Court finds that plaintiffs relied on defendants’ misrepresentations when they

did not attempt to add CUSA as a defendant in June 2002, and that this reliance was entirely reasonable.

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2. Defendants’ Improper Purpose or Knowledge of Deception

The second equitable estoppel factor concerns whether a defendant had an improper purpose or

knowledge of the deceptive nature of its conduct. Here, defendants assert that there was no improper

motive at work, and that the only reason plaintiffs were led to believe that CII, rather than CUSA,

performed planning and oversight of CNL is the innocent practice of CUSA employees of referring to

their employer by its pre-merger name and the continued use of old letterhead and forms.

Whether or not defendants had an improper purpose, they certainly had knowledge of the

deceptive nature of their conduct. A meet and confer letter plaintiffs sent on December 21, 2000, stated

that plaintiffs wished to conduct discovery into the extent to which both CUSA and CII were responsible

for the control, management and operations of CNL. Def. Exh. 6 at 11. This letter was followed by the

discovery described above, in which individuals who were involved with CNL were repeatedly

described as working for “COPI.” It was also followed by the depositions of Thomas Schull and Scott

Davis, described by defendants as two of the primary people involved in both the Parabe and

Opia/Ikenyan incidents, in which both men unequivocally stated that they worked for CII. See Def. Exh.

18 at 12; Pl. Exh. 6 at 16. While Davis indicated that he was no expert on the corporate structure of

ChevronTexaco, such expertise is not required to accurately name one’s own employer. See Def. Exh.

17 at 17.

As discussed above, defendants’ actions during discovery demonstrate that they understood the

difference between COPI and CUSA. Indeed, according to defendants’ brief, they had attempted to

distinguish between COPI and CUSA since 1999. Despite this fact, defendants failed to reveal the true

difference to plaintiffs for years, instead waiting until the end of discovery was imminent. This is more

than sufficient for the Court to find that defendants had knowledge of the deceptive nature of their

conduct.

3. Satisfaction of the Purposes of the Limitations Period

The final factor for equitable estoppel is the extent to which the purposes of the limitations

period have been satisfied. Statutes of limitations have two major purposes: encouraging plaintiffs to

be diligent in pursuing their claims; and giving defendants adequate notice of a claim while the evidence

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and memories of witnesses are fresh. See United States v. Kubrick, 444 U.S. 111, 117, 123 (1979).

Both of these purposes are satisfied here. Plaintiffs have been seeking to discover which Chevron

divisions and subsidiaries bear responsibility in this case for years, and CUSA has long had notice of

plaintiffs’ claim. Indeed, employees of CUSA – although they testified that they were actually

employees of CII – have sat for numerous depositions in this case.

Defendants’ main defense to the equitable estoppel claim is that plaintiffs knew or should have

known of their claim against CUSA and simply failed to do anything about. Defendants assert that

equitable estoppel should not apply because plaintiffs had constructive notice of their claim against

CUSA. See Campbell v. The Upjohn Co., 676 F.2d 1122, 1127 (6th Cir. 1982) (rejecting claim of

fraudulent concealment where defendant was in possession of documents that would have given him

notice of cause of action). Although defendants are correct that plaintiffs were aware of the possibility

of a claim against CUSA, their failure to pursue that claim is entirely forgivable because the bulk of

discovery led plaintiffs away from that claim. Given the repeated discovery errors identified above, the

Court finds that plaintiffs cannot be charged with having constructive notice of their claim against

CUSA.

Accordingly, the Court finds that plaintiffs are entitled to benefit from the application of

equitable estoppel.

B. Equitable Tolling

Plaintiffs also argue that the statute of limitations should be equitably tolled. “Unlike equitable

estoppel, equitable tolling does not depend on any wrongful conduct by the defendant to prevent the

plaintiff from suing. Instead it focuses on whether there was excusable delay by the plaintiff.” Santa

Maria, 202 F.3d at 1178. Equitable tolling applies where, “despite all due diligence, a plaintiff is unable

to obtain vital information bearing on the existence of his claim.” Id. Here, plaintiffs argue that the

statute of limitations should be deemed tolled from May 21, 2001, the date defendants’ first served

erroneous interrogatory responses, until September 28, 2005, the date defendants’ first produced

corporate witnesses who testified about the correct relationship between CUSA, CII, and CNL.

The Court finds that equitable tolling is appropriate in this case. For the reasons discussed

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above, plaintiffs’ failure to file a timely claim against CUSA is wholly excusable. Indeed, the practice

of referring to Chevron entities by nearly identical acronyms is confusing enough; when plaintiffs

sought to clarify the meaning of those acronyms, everything they were told led them away from CUSA

and towards CII. Plaintiffs were only able to learn of their claim against CUSA when defendants,

without any explanation, served them with their amended interrogatory answers on July 15, 2005.

Defendants argue that they would be prejudiced by the addition of CUSA as a defendant at this

late date. The fact that defendants do not object to the addition of CUSA as a defendant to plaintiffs’

ATS and TVPA claims, however, renders their claim of prejudice somewhat disingenuous. Regardless,

the Court finds the prejudice defendants cite to be lacking. Unlike in many cases, CUSA is not truly

a new defendant. Rather, its employees have participated in discovery, and its role in the attacks in

Nigeria, and its relationship with CNL, have already been the subject of discovery. Further, given that

defendants knew of the misleading nature of their discovery responses, any prejudice to defendants is

a result of their delay in correcting plaintiffs’ misunderstandings.

Accordingly, the Court finds that plaintiff’s may benefit from equitable tolling.

C. Relation Back under Federal Rule of Civil Procedure 15

Finally, plaintiffs argue that the addition of CUSA as a defendant should “relate back” under

Federal Rule of Civil Procedure 15(c)(3). The Court rejects this argument, for the same reasons

expressed in its order on plaintiff’s motion to file a fourth amended complaint. Rule 15(c)(3) only

applies where the plaintiff was mistaken as to the proper identity of the defendant, not when plaintiff

knew the identity of the defendant but didn’t ascertain defendant’s liability until after the statute of

limitations had expired. See Louisiana-Pacific Corp. v. ASARCO, Inc., 5 F.3d 431, 434 (9th Cir. 1993).

Here, plaintiffs were not mistaken as to the proper identify of CUSA. Accordingly, the Court rejects

plaintiffs’ argument that the addition of CUSA as a defendant relates back under Rule 15.

D. Extent of Estoppel and Tolling

Having found that equitable estoppel and equitable tolling apply, the Court must decide the

effect that these equitable doctrines will have on this case. Plaintiffs argue that the statute of limitations

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Because the Court effectively concludes that equitable estoppel and equitable tolling provide

plaintiffs with no relief, it does not reach defendants’ argument that plaintiffs waived the attorney-client

privilege by raising the two doctrines.

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should be tolled from at least May 21, 2001, the earliest date they believe Chevron provided incorrect

discovery about the relationship between CUSA, CII, and CNL. The Court disagrees. Despite the fact

that defendants misinformed plaintiffs about CII’s relationship to CNL, plaintiffs did not seek to add

CII as a defendant until June 28, 2002, when their RICO and state-law claims were already time-barred.

Plaintiffs make no argument that they would have brought their claims against CUSA any sooner than

they brought them against CII, had they understood that CUSA was the appropriate entity. Accordingly,

the Court will only allow plaintiffs to bring those claims against CUSA that were not time-barred as of

June 28, 2002.

Plaintiffs urge the Court to arrive at a different result, arguing that defendants’ erroneous

discovery responses stopped the statute of limitations “clock” as of May 21, 2001, and that their RICO

and state-law claims therefore remain timely. See Socop-Gonzalez v. I.N.S., 272 F.3d 1176, 1195 (9th

Cir. 2001) (“In tolling statutes of limitations, courts have typically assumed that the event that ‘tolls’

the statute simply stops the clock until the occurrence of a later event that permits the statute to resume

running.”) (emphasis in original). There are two problems with this argument. First, equitable tolling

and equitable estoppel are, as their names indicate, equitable doctrines. And the Court does not find it

equitable to give plaintiffs a second opportunity to raise claims that they let expire long ago. More

importantly, plaintiffs’ claims against CUSA do not exist in a vacuum; rather, they depend upon actions

that were previously attributed to CII. Plaintiffs’ claims against CUSA therefore do not exist

independently, but derive from their claims against CII. In other words, plaintiffs do not seek to add

new claims against a new defendant, they seek to split their existing claims to cover two defendants.

The fact that the CII claims are time-barred is therefore fatal to plaintiffs’ claims against CUSA.

Accordingly, the Court finds that, while both equitable estoppel and equitable tolling apply,

neither is sufficient to render plaintiffs’ RICO and state law causes of action against CUSA timely.

Plaintiffs may only amend their complaint to include CUSA as a defendant to those claims that were

timely as of June 28, 2002.7

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This concern is mitigated somewhat by the apparent fact that many witnesses do not seem to

understand which Chevron entity their employer actually was.

9

In their opposition brief, defendants suggest that their discovery changes may also be

detrimental to the merits of plaintiffs’ case, because the facts indicate that the alleged control over CNL

(CUSA/COP) was separated from ownership of CNL (COPI). While the Court takes no position on this

point, it notes that, to a certain degree, the amount of confusion over which Chevron entity took the

actions in question is further evidence that defendants did not strictly enforce the corporate structures

they had in place. The overlap of employees, and their general confusion over who their employer was,

only further calls into questions Chevron’s faithfulness to its corporate structure.

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III. Plaintiffs’ Motion in Limine

Plaintiffs also argue that defendants should be estopped from attributing conduct to CUSA or

other Chevron entities that they had previously attributed to employees of CII. Specifically, plaintiffs

seek an order that would bar defendants from (1) denying that CUSA employed individuals previously

identified as working for CII, (2) claiming that a wide range of documents that refer to “COPI” business

plans, decisions, and actions refer to an entity other than CII, and (3) trying to shift responsibility for

previously identified CII actions to CUSA or any other entity.

Plaintiffs’ proposal is unworkable. The Court will not order witnesses to incorrectly identify

their employer, nor will it prevent witnesses from naming the true entity that they worked for.8

Furthermore, while plaintiffs have been somewhat prejudiced by the limited amount of discovery they

were able to take regarding CUSA and the relationship between CUSA, CII, and CNL, any prejudice

is greatly mitigated by the fact that many of the so-called CII employees that took part in discovery were

actually CUSA employees.9 In any case, CUSA and CII are now each defendants to the same extent

as the other. Thus, the Court DENIES plaintiff’s motion for application of judicial or equitable estoppel.

///

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CONCLUSION

For the foregoing reasons and for good cause shown, the Court hereby GRANTS IN PART

plaintiffs’ motion for leave to file an eighth amended complaint. Plaintiffs may amend their complaint

to include CUSA as a defendant to the ATS and TVPA causes of action (Docket No. 822). The Court

DENIES plaintiffs’ motion in limine for application of equitable or judicial estoppel (Docket No. 821).

IT IS SO ORDERED.

Dated: August 21, 2006 

SUSAN ILLSTON

United States District Judge

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