A group of Ecuadorean workers is suing Occidental Petroleum for a slice of the nearly $1 billion asset seizure settlement the company won from Ecuador’s government earlier this year.
The plaintiffs filed a lawsuit against Occidental Petroleum and Occidental Exploration and Production in Houston last week, seeking class certification and damages of $265.4 million to be paid to over 300 workers.
The case was filed in the U.S. District Court in the Southern District of Texas on Feburary 22 and has been assigned to Judge Lynn N. Hughes, according to court documents seen by PGN.
The lead plaintiff is represented by Michael David Sydow of the Houston-based Sydow Firm.
The plaintiffs claim that Occidental failed to redistribute 15 percent of its annual profits to its employees as mandated by Ecuadorian law.
The damages amount is tied to a $980 million settlement Occidental won in January after the Ecuadorean government seized an Occidental field in 2006.
“Because OXY incurred no operating expense or overhead, the sum awarded by the panel is profit, and the statutory profit sharing of 15 percent is due on that sum,” the plaintiffs told Courthouse News Service,
According to Occidental’s website, the company no longer operates in Ecuador.
Ecuador seized Block 15 from Occidental in 2006 claiming that the company sold the asset to China’s Andes Petroleum without government approval.
The World Bank’s International Center for Settlement of Investment Disputes had initially awarded Occidental a $1.77 billion award in 2012 but cut the award by 40 percent in November 2015, Reuters said.
The World Bank said the award was cut to reflect Occidental’s sale of Block 15 to Andes Petroleum.
Ecuadorean Attorney General Diego Garcia told Reuters in January that Ecuador will pay the $980 million settlement by April of this year, although it remains opposed to the committee’s decision.