Ecuador’s fugitive billionaire ‘Banana Baron’ plays cat-and-mouse game with U.S. and Ecuadorian authorities

By James McKindley, Jr.

The simple black-and-white advertisement, addressed to “whom it may concern” in all capitals, had a taunting, catch-me-if-you-can tone. The author said he could be served legal papers only in his native Ecuador and only in person.

“It would have to be done by looking me in the eyes, asking my name and giving me the service in my hands,” he wrote.

The ad in The New York Times on July 25 was signed by Alvaro Noboa, one of the richest men in Latin America, a perennial candidate for president in Ecuador and the head of the gargantuan banana business Grupo Noboa, S.A. A similar ad followed on Friday.

Why would a South American banana mogul pay for such a message? And to whom was it of concern?

The answers can most likely be traced to an $8.7 million judgment issued against Noboa in 2010; that award to NYK Cool A.B., a subsidiary, based in Stockholm, of a Japanese shipping company, has never been paid.

“It has everybody on our side of the fence scratching our heads,” said Edward Keating, a lawyer representing NYK Cool. “He’s a guy who doesn’t mind spending money to voice his private opinion on these topics.”

The judgment against him in New York came in only one of many legal battles Noboa has fought over the years. In the 1990s, he fought a bitter court battle on three continents to wrest control of his father’s banana empire away from his sisters and his stepmother. His father, Luis Noboa Naranjo, had left Noboa no stake in the banana empire when he died.

That series of lawsuits finally ended in November 2002, when a judge in London awarded Noboa a 50 percent stake in the family’s holding company.

In 2009, a model in New York sued him for sexual harassment, claiming he had lured her to Ecuador with an ad on Craigslist, then forced her to have sex with him as his armed guards waited outside the room. The suit was eventually settled out of court; the terms are confidential.

More recently, tax authorities in Ecuador have clashed with Noboa several times over back taxes amounting to hundreds of millions of dollars. Indeed, he took out another ad in The Times last November to complain about the “relentless political persecution” of his government’s tax officials. He has run three times for president of Ecuador, being defeated on each occasion.

Noboa did not return telephone messages left at his office.

Keating said his client’s dispute with Noboa stemmed from a four-year deal, reached in 2004, that would have NYK Cool transport fruit from Ecuador to the United States, then on to Japan.

But as fruit sales in Japan dropped, Noboa pulled out of the deal after two years. Executives from Noboa’s companies argued that the agreement had never been made final.

NYK Cool sued and in April 2010 won the $8.7 million judgment from a panel of three maritime arbitrators in New York City. That award has since been affirmed twice by Judge Lewis A. Kaplan in federal court in Manhattan.

Instead of paying, Noboa transferred millions of dollars out of the two companies named by the panel’s decision into other companies he controlled, leaving NYK Cool no way to collect the money, according to the shipping company’s suit and Judge Kaplan’s ruling.

“Since then, he’s been bobbing and weaving,” Keating said.

The shipping company finally decided in April to file a motion before Judge Kaplan seeking payment from Noboa himself. The only trouble was the company’s lawyers had never managed to serve him in person with the original lawsuit.

Keating said an attempt to locate Mr. Noboa in Miami, where he was rumored to be staying to evade Ecuadorean tax officials, led to nought. In Ecuador, Noboa is notoriously hard to reach since he is on the run from tax authorities; he travels surrounded by armed guards and assistants.

In October 2012, the lawyers sent the papers to a general email address connected to Cruzada Nueva Humanidad, a humanitarian organization Noboa set up. They also sent a copy of an amended complaint by courier to an address of one his companies, Truisfruit, in Guayaquil, Ecuador. The package was never delivered, according to court papers.

Noboa’s lawyers argued in federal court that their client had never been properly served. On July 15, Judge Kaplan ruled in Noboa’s favor, ruling the shipping company’s efforts so far to put the lawsuit in Noboa’s hands had been insufficient. It was not enough, he said, to email the papers to Noboa’s charity.

Still, Judge Kaplan enumerated an alternative for Keating and his client. He ruled that NYK Cool could serve Noboa simply by handing the papers over to the lawyers who represented him in the new court proceeding, which Keating says he has since done.

Those lawyers, Daniel B. Goldman and Rachel Lynn Snyder of Paul Hastings L.L.C., did not return telephone calls and emails seeking comment.

Noboa’s ad suggests they no longer represent him. “I, Alvaro Noboa, inform that I have not hired or authorized this and last year or any other year any person or lawyer to be served by the court in my name,” the ad said.

Keating chuckled at the wording. “It’s a three-card monte,” he said.

Credit: The New York Times, www.nytimes.com; Photo caption: Alvaro Naboa