On Friday, a Massachusetts court heard arguments on why it should dismiss the state attorney general’s climate lawsuit against a major energy company.
The hearing comes a little over a year after a New York Superior Court threw out the New York attorney general’s similar investor fraud case and as the U.S. Supreme Court weighs a decision that would impact in what court the 20+ other public nuisance cases are heard.
Arguing before Suffolk Superior Court Justice Karen Green, ExxonMobil ran through a number of reasons why Massachusetts Attorney General Maura Healey’s complaint alleging consumer and investor fraud claims against the company should be thrown out, highlighting the attorney general’s flagrant constitutional violations and failure to state a claim.
“An Absurd Argument”
During the hearing, ExxonMobil argued that Healey’s lawsuit is baseless because it’s grounded in a difference of opinion concerning the role fossil fuels will play in the future, which no one can know.
What’s more, opinions regarding events in the future are not enforceable under Chapter 93A, which is Massachusetts’ consumer- and investor-protection law and the backbone of Healey’s lawsuit:
“The attorney general’s view is quite negative on the outlook for oil and gas. The attorney general believes that society needs to move swiftly away from fossil fuels. ExxonMobil has a different perspective. It feels there is a significant role for fossil fuels to play to meet the dual challenge of growing demand for energy while reducing greenhouse gas emissions. ExxonMobil is entitled to have that view just like the attorney general is entitled to have hers.” (emphasis added)
The company also pushed back against Healey’s allegation that the company “greenwashes” the risks climate change poses to its business, calling the argument “absurd.”
In one instance, for example, the attorney general claims that one of ExxonMobil’s logos – featuring an image of the sun at the top, green mountains in the middle, and a blue river at the bottom – is “misleading”:
“Is the attorney general going to decide which companies get to use which logos? Is the attorney general going to decide that only companies it approves of can have logos with a yellow sun, a blue sky and green grass, and companies it doesn’t approve of have to have skull and crossbones? It’s an absurd argument.” (emphasis added)
The company also highlighted the irony that the Commonwealth’s use of natural gas has doubled in the last twenty years – a trend that the state frames as a positive – while at the same time the attorney general is targeting ExxonMobil for using “language that’s nearly identical”:
“Now, since suing the EPA twenty years ago over climate change and greenhouse gases, the Commonwealth has chosen to double its reliance on the fossil fuel natural gas. The Commonwealth claims that its transition towards natural gas is positive, and it defends it using language that’s nearly identical to the language it faults ExxonMobil for using. Massachusetts says natural gas is cleaner, has a lower carbon content, it’s more efficient. It’s a bridge to a clean energy future. And, most relevant here, Massachusetts has said that by using natural gas, it’s projected to reduce greenhouse gas emissions.
These are clear statements of a relative nature. … Just as no reasonable resident would believe that the Commonwealth’s use of natural gas generates no greenhouse gas emissions, no reasonable consumer in Massachusetts would believe that Synergy gasoline generates no greenhouse gas emissions. It is an unreasonable inference and this court should reject it.”
A Case Without Specifics
During the hearing, the company pointed out that the attorney general’s complaint is all fluff, as it doesn’t actually identify a single statement that would mislead a reasonable consumer or investor about the characteristics of the company’s products or securities:
“Issues don’t give rise to liability under [Chapter] 93A and [the attorney general] had a burden to say, ‘These are the statements.’ And my other brother attempts to avoid that burden – he didn’t really talk about the statements that Exxon has made, those that allegedly give rise to the claim. He simply wants to avoid that burden by saying, ‘Exxon lied, and climate change is bad, and therefore we should survive the motion to dismiss.’” (emphasis added)
The company also makes explained that the attorney general has obstructed the company’s right to petition policymakers and the general public regarding climate change.
As the company explained, ExxonMobil has in fact worked to raise awareness on climate change – and those efforts are protected by Massachusetts’ anti-SLAPP statute, which prohibits the use of litigation for punishing a defendant for protected “petitioning activities,” such as lobbying elected officials or making public statements on a controversial issue:
“ExxonMobil for the better part of the last decade has recognized that climate change presents a challenge, that climate change is real and presents a challenge to governments on how to address it; while at the same time encouraging the efficient supply of energy to meet a growing, more prosperous world. ExxonMobil has been engaging on that policy for at least the last decade, your Honor, and it does so in ways that are directly protected by the [anti-SLAPP] statute.” (emphasis added)
The company concluded its arguments by driving home the point that Massachusetts has no jurisdiction in this matter, as neither it nor its alleged misconduct has any real ties to the Commonwealth.
As such, the company asked Judge Green to strike all comments it made outside the Bay State that the attorney general cites in its complaint:
“The attorney general has chosen to come after ExxonMobil, that’s fine. We can defend ourselves. But when the attorney general does that, and … says, ‘We’ve lied.’ We have a right to say, ‘What did we lie about?’ ‘What are the full statements that you say are actionable?’ And the attorney general should be held by this court to its burden of coming forward and saying, ‘These are the statements in Massachusetts that give rise to the claims.’ To the extent that that 200-page complaint is filled with statements that were made outside of the jurisdiction, we respectfully request that you strike all of them.”
Lessons from History
A lawyer representing the company said that the timing was “highly suggestive” of an improper motive: perhaps to harm the company’s reputation during the trial, or “it could be that the attorney general just wanted some press.”
Recall that the New York attorney general investigated ExxonMobil for four years, reviewing millions of pages of documents, only to suffer a spectacularly embarrassing defeat in state court at the end of 2019.
Though Massachusetts’ case is broader in scope, the New York attorney general had the benefit of a more powerful securities law than Healey’s and still came up empty-handed.
Indeed, in his opinion detailing the New York attorney general’s loss, New York Supreme Court Justice Barry R. Ostrager wrote:
“What the evidence at trial revealed is that ExxonMobil executives and employees were uniformly committed to rigorously discharging their duties in the most comprehensive and meticulous manner possible.
“More than half of the current and former ExxonMobil executives and employees who testified at trial have worked for ExxonMobil for the entirety of their careers. The testimony of these witnesses demonstrated that ExxonMobil has a culture of disciplined analysis, planning, accounting, and reporting.” (emphasis added)
While there is no set timeline for Judge Green to issue her ruling, it is expected within the upcoming weeks or months.
Read more at EID Climate
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