New York State is alleging ExxonMobil knew the risks of climate change and defrauded its investors by misrepresenting them.
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n October 23, in a federal court in New York, opening arguments will be heard in one of the most important corporate malfeasance cases of the modern era, rivaled only by the tobacco litigations of the 1990s. The state of New York is suing ExxonMobil on charges that the energy goliath consistently misled its investors about what it knew concerning the climate crisis—essentially lying to them about what it might eventually cost the company in eventual climate-related financial risks, because the company knew better than practically anyone else what those risks were. From Inside Climate News:
Exxon engaged in “a longstanding fraudulent scheme” to deceive investors by providing false and misleading assurances that it was effectively managing the economic risks posed by increasingly stringent policies and regulations it anticipated being adopted to address climate change, the lawsuit states. “Instead of managing those risks in the manner it represented to investors, Exxon employed internal practices that were inconsistent with its representations, were undisclosed to investors, and exposed the company to greater risk from climate change regulation than investors were led to believe,” the lawsuit said.
And the hardball has begun in earnest, again via ICN:
New court filings reveal that Exxon sent letters to a group of investment advisers and shareholder activists who prosecutors want to put on the stand, informing them they will be subject to subpoenas from the company seeking documents relevant to the case if they choose to testify. Because of their roles investing in and engaging with Exxon over climate change, these witnesses’ testimony could prove critical to the state’s case. With opening statements scheduled to begin Oct. 23, a lawyer in New York Attorney General Letitia James’s office wrote that the request would “impose disproportionate burdens on these witnesses in a transparent attempt to discourage them from testifying voluntarily, and threatening to upend the trial schedule.”…
While prosecutors had agreed to allow Exxon to interview the witnesses before the trial, the company went further by sending at least one witness what the attorney general described as an expansive request for documents and communications, including “all documents concerning your oil and gas holdings” and more. Exxon wrote on July 30 that it planned to send documents requests to seven witnesses.
The case is historic, especially in light of the revelations that Exxon and other energy companies knew as long ago as 30 years that carbon emissions were becoming perilous to the planet. It is possible that, if the case proceeds to trial, the energy companies may find themselves in the same spot where Brown & Williamson was on the subject of whether nicotine was addictive. MORE