Private Empire: ExxonMobil and American Power

by Steve Coll

  ExxonMobil’s “idea of community development was, ‘You give me a proposal and we’ll assess it,’” one former employee familiar with the campaign recalled. “The people [Acehnese] would say, ‘Give us ten cows for community development.’ Exxon would assess it and say, ‘Well, that fits with our approach,’ and they would give the cows, and the next day the cows would be roast beef and there would be a big party in the village.”7

  Cows not eaten immediately wandered around with “ExxonMobil” stenciled in red on their backsides. “It was just, ‘Give, give give.’” ExxonMobil “went into this Father Christmas mode,” the employee recalled. “They built volleyball courts—just slabs of concrete in paddy fields. You had so many volleyball courts around Aceh. They were just slabs of concrete, but G.A.M. imposed a tax on all construction, so G.A.M. liked this.”

  ExxonMobil opened a health clinic in Aceh that sometimes treated as many as three or four hundred patients a day, according to the former employee involved. The doctors prescribed Valium to reduce the stress of farmers and villagers living amid the violence. The stress could be particularly intense for Acehnese employees of the oil corporation. G.A.M.’s intelligence officers knew of the local employees’ salaries, where they lived, and who their family members were. Rebel extortionists would telephone and say, “We’re going to tax you thirty million rupiahs,” or about $3,300. If an employee received such a call, he or she could negotiate the price, but would have to pay—or face death. “The local employees were really out on a limb,” the person involved in the outreach campaign recalled. “G.A.M. was everywhere.” ExxonMobil’s expatriate managers “never quite understood what was going on.”8

  As the war calmed, John Doe I et al. v. ExxonMobil Corporation et al., the lawsuit filed in Washington, D.C., on June 19, 2001, by Terry Collingsworth, on behalf of eleven anonymous alleged victims of the T.N.I.’s violence around the gas fields—seven John Does and four Jane Does (some of whom were representatives of their dead spouses)—seemed to some of Aceh’s human rights activists to offer the only plausible means by which the ghosts of the province’s torture rooms and civil violence might be exorcised. Through the lawsuit’s fact-finding, some measure of transparency and accountability about Aceh’s past might be established, they believed. The democratic government of Indonesia had neither the means nor the will to overcome the resistance to investigations by T.N.I. leaders; that would require the distance and relatively neutral setting of an American courtroom. From the beginning of the Doe case, however, ExxonMobil used the deep sensitivity within Indonesia about the subject of Aceh’s human rights abuses as a bulwark in its own legal defense strategy.

  If the case ever came to trial, ExxonMobil’s lawyers made clear in early court hearings, the corporation’s defense would pursue the argument that Indonesia’s generals, not ExxonMobil’s executives, were responsible for any actionable violence and, therefore, any financial liability.

  To lead its defense, ExxonMobil retained Martin J. Weinstein, a former federal prosecutor specializing in corruption and overseas bribery cases, who was a partner in the Washington office of Willkie Farr & Gallagher. Among other previous assignments, Weinstein had investigated Pete Rose’s gambling activity on behalf of the commissioner of Major League Baseball. He was a wealthy, forceful K Street litigator. Weinstein was an active political contributor, primarily to Republican candidates.

  In Doe, his strategy was to have the lawsuit thrown out before its factual allegations about human rights violations in Aceh could be tried. Weinstein asserted that the case should be set aside or dismissed because it would interfere with the Bush administration’s efforts to enlist Indonesia as an ally against Al Qaeda after the September 11 attacks. Indonesia had, in fact, been a locus of radical Islamist groups that had trained and aligned themselves with Osama Bin Laden. Weinstein’s approach asked, in effect, which was more important: the appeasement of the Indonesian military, to induce cooperation against Al Qaeda, or the promotion of universal human rights, through the normal functioning of American civil law?

  The Doe case fell by random assignment to Judge Louis F. Oberdorfer of the United States District Court in Washington. The judge was a former clerk to Supreme Court Justice Hugo Black; he had served in Robert F. Kennedy’s Justice Department and had been appointed to the bench by President Jimmy Carter. By the time the Aceh matter landed on his desk, however, Oberdorfer was eighty-two years old. He occasionally appeared at hearings wearing an oxygen mask, which unnerved some of the lawyers who argued before him.

  It was established American law that domestic courts should not lightly interfere with a president’s foreign policy. Federal judges regularly asked for advice or comment from the State Department when a civil case like Doe might affect American interests abroad. Martin Weinstein asked Judge Oberdorfer to make such a query of State. Even apart from ExxonMobil’s deep connections to the Bush administration, and the administration’s earlier intervention against G.A.M., Weinstein had ample reason to think that Secretary of State Colin Powell and his principal legal adviser, William H. Taft IV, the great-grandson of the former Republican president, would lean ExxonMobil’s way. State’s lawyers often looked skeptically at the novel use of the eighteenth-century Alien Tort Claims Act to seek civil damages in American courts on behalf of overseas abuse victims. “It’s another one of those pesky ATS [Alien Tort] cases keyed to corporate liability,” State Department lawyer David P. Stewart wrote to colleagues when Oberdorfer’s request for advice landed at Foggy Bottom.9

  In fact, Taft and his colleagues were torn. They wanted to discourage Alien Tort cases. They wanted to support the White House’s plan to build a new counterterrorism partnership with Indonesia. But they did not want to send a message to the T.N.I. that would lead its generals to believe they enjoyed a free hand in Aceh or on human rights issues. Taft sent Oberdorfer a six-page letter that tried to express this balance. The letter aligned the Bush administration with ExxonMobil’s arguments, but also attempted to pressure Indonesia’s military to improve its human rights performance. “Adjudication of this lawsuit at this time would in fact risk a potentially serious adverse impact on significant interests of the United States, including interests related directly to the on-going struggle against international terrorism,” he wrote. “It may also diminish our ability to work with the Government of Indonesia on a variety of important programs, including efforts to promote human rights.” If the lawsuit went forward, Indonesia might reduce or end cooperation with the Bush administration on “issues of substantial importance to the United States.”10

  It was a victory for the oil company, but not a total one: Taft had used wiggle words, more so than in some other State objections to cases of this type. “At this time” was a phrase Taft had employed more than once, for example. Oberdorfer and his clerks seemed to take the hint. ExxonMobil urged the judge to dismiss the Doe case outright, but rather than ruling promptly, he delayed. He also ordered the corporation to preserve all the documents and evidence that might be relevant if the case did go forward.

  More than one hundred thousand Acehnese died in about twenty minutes on December 26, 2004, when ocean waves unleashed by an earthquake crashed onto northern Sumatra. The water buried scores of villages in mud and carried ships several miles into the jungle. The tsunami decimated both sides of Aceh’s civil war; its toll exceeded by many orders of magnitude the carnage from man-made violence around the gas fields. The shock of the disaster, as well as the massive international relief and development effort that followed, set conditions during 2005 for breakthrough peace talks between the government and G.A.M.

  On May 24, Judge Oberdorfer summoned the Doe lawyers back to his courtroom.

  “It says in here,” the judge said, referring to the text of Taft’s original letter, that ‘adjudication of this lawsuit at this time would in fact risk a potentially serious adverse impact on significant interests of the United States.’ Now, that was at that time, which was July 2002. At this time, d
oes the same thing apply?”

  A lawyer from the United States Attorney’s office, assigned to monitor the proceedings, stood to report that he had recently “touched base” with the Bush administration’s State Department and was told that the letter “remains their view at the present time.”

  “Your Honor,” Martin Weinstein said, “this case involves alleged conduct in which the government of Indonesia and the military of Indonesia, in the midst of fighting a civil war on its own soil, has taken certain actions, and whether or not they are proper in the midst of civil war. The conduct of ExxonMobil as a contractor . . . is inextricably intertwined with the conduct of the Indonesian military.”

  It had been almost four years since Terry Collingsworth had traveled through Aceh’s war zone to interview victims of the T.N.I., and he had yet to even receive a decision on jurisdictional issues in the case. Judge Oberdorfer had just turned eighty-six.

  Collingsworth, who was a full-faced man with blue eyes and thick reddish eyebrows, which he sometimes cocked in a rakish manner, now rose to report that two of his John Doe plaintiffs had been murdered during the years that the case had been on hold.

  “We sent somebody after the storm who was Acehnese and was able to move around,” he said. Nine of the eleven plaintiffs had survived the tsunami. “Two of our plaintiffs have died, but unfortunately it was not due to natural causes. . . . They were killed by the military, we believe, that were operating on behalf of ExxonMobil.”11

  Oberdorfer searched for a way to begin taking testimony from ExxonMobil executives, to move toward trial. He probed the lawyers for a plan that would sidestep the State Department’s concerns about Indonesia’s sensitivities. The judge soon ruled that the case should go ahead. He threw out the controversial Alien Tort Claims Act elements but kept the lawsuit alive as a tort case—the international equivalent of a slip-and-fall lawsuit. The Acehnese victims had standing to sue ExxonMobil in a D.C. court, Oberdorfer concluded, because ExxonMobil had a substantial office on K Street, from which managers such as Robert Haines had overseen the corporation’s security operations in Indonesia.

  Collingsworth still feared for his clients, he said.

  “But you’re not ascribing that to any action taken by Mr. Weinstein’s client, are you, the fact that they were killed?” Oberdorfer asked. “I mean, has there been a disclosure” of the real identities of the John Does and Jane Does in the case?

  “Yes, there has. . . .”

  “To make it very clear,” Martin Weinstein answered, “this case has been around for five years. We have precisely stayed clear of this issue until now” because ExxonMobil feared it would be blamed for any harm that came to the Doe plaintiffs, no matter the cause. “So to be quite clear, we want to see these people happy and healthy and in whatever current state they are because even without having their names, we’re going to be blamed for what happened to them.”

  Collingsworth explained that he was not accusing ExxonMobil of murdering his clients—certainly not directly. He went on, however: “It is not our theory of the case, and Mr. Weinstein knows this, that [ExxonMobil employees or lawyers] went to Indonesia and ordered our clients to be harmed. . . . Our theory of the case is primarily one of [ExxonMobil] having set up a project in such a way with a security force that is dangerous, that we’re entitled to know, ‘Did you anticipate that danger? What did you do from the United States to anticipate and ameliorate that danger?’”12

  Collingsworth crystallized why ExxonMobil was really in the dock: that it had failed to anticipate the consequences of its operations in Aceh, and had failed to move actively to protect civilians as best it might. The corporation might not have directed any of the violence, but if its leaders had exercised sufficient care and activism, torture and killings might have been avoided. ExxonMobil’s presence in Aceh fueled conflict; therefore, the corporation had a duty to act preventively. Collingsworth’s accusation demanded, in effect, that ExxonMobil consider the repercussions of its presence anywhere, especially in weak, poor societies prone to conflict, where oil and gas windfalls provided ample motive to anyone with a gun.

  ExxonMobil appealed Oberdorfer’s decision to proceed; more delays followed. As Doe languished, the corporation moved to strengthen its protections against future lawsuits of its genre. Lee Raymond agreed, as he prepared to step down, to have ExxonMobil finally join BP and other oil and mining companies in the Voluntary Principles on Security and Human Rights regime, which Raymond had initially rejected in 2000 and 2001. The Bush administration had since endorsed the system. It committed corporate signatories to communicate their human rights standards to local security forces; authorize the use of force around their properties only in proportion to threats; and vet local militaries serving them for known rights abusers. Mike Farmer, the longtime head of ExxonMobil Global Security, adapted these rules and expectations into a new human rights and security manifesto within the O.I.M.S. operating system. He rolled the human rights regime out to ExxonMobil affiliates worldwide as Rex Tillerson took office.

  Tillerson’s embrace of the compact, like his review of climate policy, marked another turn from ExxonMobil’s stubbornness during the first Bush term. The new human rights system required audits and reviews of whether local security forces protecting ExxonMobil oil and gas fields were in compliance with the standards defined by the Voluntary Principles’ steering committee. ExxonMobil assigned an Irving-based executive, Kevin Murphy, to join that leadership committee. The corporation was true to its self-image: It might not readily join squishy liberal-minded regimes like the Voluntary Principles, but if it did so, it would go all out. Longtime critics of ExxonMobil in the human rights community marveled as the corporation’s new approach unfolded under the O.I.M.S. spur: “It’s like implementing human rights through a police state,” Arvind Ganesan of Human Rights Watch quipped.13

  Although it was not foolproof, the Voluntary Principles would shield ExxonMobil from human rights cases like Doe in the future by helping the corporation to argue to a jury or judge that it had taken all the steps it reasonably could to protect civilians in its areas of operations. This might be self-interested, but the compact had been constructed to appeal to such corporate instincts. The practical effect would be to bring ExxonMobil more closely into line with the corporate responsibility practices of other large multinationals—to socialize Exxon in an era of global norms increasingly influenced by civil society. This was the emerging pattern of the Tillerson era: ExxonMobil’s new regime learned its lessons late, never admitted the corporation had been wrong in the past, but it shuffled nonetheless in new policy directions, seeking a sustainable form of corporate normalcy and legitimacy. All that remained now was to dispose of the potential legal liabilities from the past. Burying the Doe litigation by delay, it seemed to Terry Collingsworth and his colleagues, was a core element of ExxonMobil’s strategy.

  Collingsworth had brought on Agnieszka Fryszman as a cocounsel to handle courtroom arguments and litigation strategy for the John and Jane Doe plaintiffs. She was a Brown University and Georgetown Law graduate who specialized in human rights, antitrust, and class-action cases on behalf of small businesses, women, and abuse victims. After September 11, she had provided pro bono representation to families of victims of the attacks as well as detainees at Guantánamo. She was accustomed to well-funded corporate opponents, but she found the ExxonMobil legal team at Willkie Farr, led by Weinstein, to be aggressive beyond the norm. “They wanted to grind us into the dust—it was scorched-earth,” she said later. “They have way more resources and they use them. They file motions to reconsider and they file simultaneously in all possible courts. They know we’re just two people.”14 The paper blizzard from Willkie Farr veered so far out of control that at one point a magistrate working with Judge Oberdorfer ordered all lawyers in the case to sign an affidavit affirming that they had read Rule 12—the principal guidelines on federal legal procedure, which prohibited the gratuitous use of filings to harass an opponent—
before they could file another motion.

  Because of ExxonMobil’s appeals, the Doe case wound its way toward the United States Supreme Court. ExxonMobil retained the prominent Supreme Court advocate Walter Dellinger and the well-known white-collar defense lawyer Theodore V. Wells Jr. to represent the oil corporation. The Supreme Court asked the Bush administration for an opinion about whether it should take on the appeal. The issue fell to the administration’s solicitor general, Paul Clement. His office invited the two sets of lawyers to separate informal meetings at the Justice Department.

  Collingsworth had by now moved into a new private firm. One of his partners, Bill Scherer, was a Florida Republican who had helped President Bush during the 2000 vote recount. Scherer believed in the human rights agenda behind the Aceh case and sought out a meeting at the White House to put in a word for his partner’s cause. He met in Washington with one of Karl Rove’s successors on the political side of the West Wing. His White House interlocutor heard him out and then told him, straightforwardly, “That’s up to Dick Cheney.”15

  In a reception area at the solicitor general’s office at the Justice Department, on Pennsylvania Avenue, Agnieszka Fryszman and her team waited for their session with Clement. The intimidating figures of Dellinger and Wells emerged—they had gone first and had just completed their presentations on ExxonMobil’s behalf. “They are grinning, laughing,” one of the participants recalled. “They think their meeting has gone really well. They’re high-fiving each other, popping champagne bottles—not literally, but you can tell they’re going out to celebrate.”