press release

Unocal actions not on trial in California case; company expects to be vindicated of 'vicarious liability' charges

For more information, visit the Unocal in Myanmar web site.

El Segundo, Calif., June 12, 2002 -- Unocal Corporation will vigorously contest the allegations that the company is vicariously liable for human rights abuses committed by the Myanmar military in conjunction with the Yadana natural gas pipeline project.

A California Superior Court judge in Los Angeles ruled yesterday that Unocal was not directly liable for the plaintiffs' claims of human rights abuses in Myanmar and that the company's investment in Myanmar did not cause the plaintiff's alleged injuries.

In addition, the judge allowed part of the lawsuit against Unocal to go to trial later this year in California Superior Court. The trial will focus on "vicarious liability," that is, whether Unocal is responsible for human rights abuses allegedly committed by the Burmese military in connection with the construction of the Yadana natural gas pipeline project.

Unocal noted the following points:

  • No Unocal actions are on trial in this case. Unocal is simply a minority investor in the pipeline and not the operator. The lawsuit seeks to hold us "vicariously liable" for the actions of the armed forces of a sovereign nation.
  • No evidence has been presented to suggest that Unocal participated in or influenced any human rights violations allegedly committed by the Burmese military. Both federal and state courts have dismissed such allegations.
  • Both federal and state courts have found no evidence to suggest that Unocal ever sought to use forced labor on the Yadana project. In fact, the evidence shows that TotalFinaElf (the project operator) acted decisively to prevent the use of forced labor on the project.
  • The Yadana pipeline project was constructed and is being operated according to high ethical standards and modern business practices. It has provided real and significant benefits in employment, education, and healthcare to the 43,000 villagers and farmers who live in the pipeline area.

The company said it has always acknowledged the challenges of investing in a country with a long history of ethnic conflict that is ruled by an authoritarian military government. Despite these difficulties, we are confident that no human rights abuses have occurred in the construction or operation of the pipeline. In fact, the company has met with the government on a number of occasions to express our concerns about reports of human rights abuses by the Burmese armed forces. We are absolutely convinced that the presence of Unocal and other companies who follow high ethical standards and modern business practices can have a positive impact on the economic and political life of the people of Myanmar.

Updated: June 2002