In what has become the go-to intimidation tactic for Exxon and its allies, Exxon has announced that it is launching yet another baseless, vexatious discovery process designed to prove that every city, state, journalist, and nonprofit that investigates the company is part of a massive conspiracy to suppress its constitutional rights.
Exxon’s latest targets (and the newest members of the supposed conspiracy) are sixteen public officials and attorneys representing seven California cities and counties — San Francisco, Oakland, Imperial Beach, Marin, San Mateo, Santa Cruz, and Santa Cruz County. Yesterday, Exxon asked a state district court in Tarrant County, Texas, to authorize depositions and other discovery against these officials in hopes that doing so will allow Exxon to sue them down the road. All seven California jurisdictions are currently suing Exxon and other fossil fuel producers for their role in causing the climate crisis, on a variety of legal grounds and with the support of multiple law firms. In a transparent effort to circumvent attorney-client privilege, Exxon is seeking discovery not only from the cities, but from their lawyers as well.
We’ve seen this tactic too many times.
In 2016, faced with ongoing investigations by the Attorneys General of New York and Massachusetts, Exxon took the then-unprecedented step of suing the AGs in a federal district court in Texas. There, again, the company alleged that the investigations into its own conduct and deception were part of a massive conspiracy involving public prosecutors, philanthropic foundations, lawyers, NGOs, and individual researchers.
On the day after Donald Trump was elected president, I became a recipient of one of those subpoenas. At this point, a subpoena from Exxon is almost a badge of honor.
But it’s not a very exclusive club. Even before I received my own subpoena, Exxon and its allies in the House Science Committee had sent subpoenas to a raft of other individuals, foundations, and public officials, including the New York and Massachusetts Attorneys General. Those subpoenas ultimately went nowhere, as this latest round is likely to do. What they did instead is waste the time, energy, and resources of countless people and organizations as a means to delay ongoing investigations and intimidate those who would bring the truth about climate change to light.
Despite a series of interim orders that can best be described as inordinately favorable to Exxon, the federal court in Texas ultimately accepted that it had no jurisdiction over the case. The court then ordered Exxon to re-file its claims in New York. In the ensuing months, Exxon has lost at nearly every stage in the proceedings. At the most recent hearing in the New York case, a panel of the New York Supreme Court observed that Exxon’s purported constitutional claims were based on “wild leaps of logic.”
But apparently the lesson Exxon has learned from this experience is that it should sue in state courts instead. So here we go again.
To get around its previous failure in Texas federal court and the ongoing, active litigation in California, Exxon constructs a legal argument that is Rube Goldbergian in its complexity. Using an argument already roundly rejected in Massachusetts, Exxon argues that California courts lack personal jurisdiction over the company because it does not conduct business in California. On the other hand, Exxon alleges, a Texas court should have jurisdiction over sixteen people from California and Massachusetts because they may be conspiring to violate Exxon’s constitutional rights in Texas. Courts in Massachusetts and New York have thus far found such arguments baseless.
Exxon justifies this newest witch-hunt on the grounds that it may reveal stark differences between the climate impacts alleged by the California cities in their complaints against Exxon and the potential impacts of climate change as disclosed in municipal bond filings by those same cities. Exxon argues, for example, that San Mateo failed to disclose the risks of rising sea levels in its municipal bond prospectuses in 2014 and 2016, while conveniently ignoring that San Mateo’s didn’t complete its assessment of sea level impacts until 2017. It also fails to acknowledge that San Mateo and other cities are making significant investments to reduce the anticipated impacts of sea level rise and abate the climate nuisance Exxon helped create—and that recouping the cost of those investments (not suppressing free speech in Texas) is the explicit purpose of their suits against fossil fuel producers.
As the devastating effects of last year’s hurricanes and wildfires demonstrate all too clearly, the impacts of climate change for cities and states across the US are real, significant, and mounting. These impacts do indeed create financial risks. CIEL was among the early organizations to highlight those risks and urge credit rating agencies, pension funds, and other financial actors to carefully consider those risks in assessing investments. And as Moody’s Investment Service recently noted, cities have a responsibility to disclose climate risks when they issue municipal bonds.
But Exxon’s threatened legal action is less an effort to protect investors in municipal bonds than to use spurious allegations of fraud and conspiracy to intimidate the California plaintiffs and delay and disrupt ongoing litigation.
The irony of Exxon’s conduct—and its filings—can’t be ignored.
There is indeed mounting evidence of a climate conspiracy and potential climate fraud. But that evidence does not point to investors, or to NGOs, or to public officials in climate-affected cities. It points to Exxon and to other fossil fuel producers.
A major finding of the New York Attorney General’s office is that Exxon itself appears to have misled consumers and investors for decades about the risk of climate change to its products. In a court filing last summer, the New York AG warned that “Exxon may still be in the midst of perpetrating an ongoing fraudulent scheme on investors and the public.”
Exxon sees climate conspiracies everywhere it looks. It’s time for Exxon to look in the mirror.