A Historic Coalition Is Building to Investigate Exxon's Alleged Climate Fraud

Several of the nation’s top state law enforcers have banded together to investigate Exxon’s alleged fraud and defend Obama’s Clean Power Plan against attacks from Big Oil. On Tuesday, several state attorneys general announced a new partnership on crucial initiatives related to climate change, including an ongoing investigation into ExxonMobil that may extend to other oil and gas companies. The inquiries are seeking to find out if Exxon intentionally misled investors and the public about the negative impact its business has on the planet's climate.

Led by New York State Attorney General Eric Schneiderman, the group gathered for the press conference—which included AGs from Massachusetts, Maryland, Connecticut, Virginia, Vermont and the U.S. Virgin Islands—and announced their commitment to pursuing an ongoing investigation of Exxon for what climate activists have decried as a long-term campaign of climate denial and deception.

The other state AGs participating in the joint effort are Kamala Harris of California, Matt Denn of Delaware, Karl Racine of the District of Columbia, Lisa Madigan of Illinois, Tom Miller of Iowa, Janet Mills of Maine, Lori Swanson of Minnesota, Hector Balderas of New Mexico, Ellen Rosenblum of Oregon, Peter Kilmartin of Rhode Island, and Bob Ferguson of Washington.

“Years from now, this meeting by Attorney General Eric Schneiderman and his colleagues here today may be well be looked back upon as a real turning point,” said former Vice President Al Gore, who raised the public’s awareness of the dangers of climate change in the 2006 film An Inconvenient Truth.

Gore was invited to speak at the press conference, where he vividly expressed the magnitude of our current situation:

We're putting 110 million tons of man-made, heat-trapping, global-warming pollution into the thin shell of atmosphere surrounding our planet every day, as if it's an open sewer. The cumulative amount of that man-made global warming pollution now traps as much extra heat energy in the Earth's system as would be released by 400,000 Hiroshima-class atomic bombs exploding every 24 hours on the surface of our planet. It's a big planet, but that's a lot of energy and it is the reason why temperatures are breaking records almost every year now. 2015 was the hottest year measured since instruments have been used to measure temperature. 2014 was the second hottest. 14 of the 15 hottest have been in the last 15 years. … February continues the trend by breaking all previous records, the hottest in 1,632 months ever measured.

The AG’s investigation was initially provoked by published reports, based on internal company documents, suggesting that during the 1980s and '90s, Exxon used scientific research on climate change to plan its business, while arguing publicly that the scientific evidence of global warming was not clear. The reports were cited in stories by reporters from the nonprofit InsideClimate News as well as the Columbia University Energy and Environmental Reporting Fellowship, which published its stories in partnership with the Los Angeles Times.

"This is about facts, and science, and transparency," said Massachusetts Attorney General Maura Healey. "Fossil fuel companies that deceived investors and consumers about the dangers of climate change should be, must be held accountable," Healey said, noting the "troubling disconnect between what Exxon knew, what industry folks knew, and the company and industry chose to share with investors and the American public."

Schneiderman addressed critics of the investigation who argue it is interfering with First Amendment rights:

The First Amendment, ladies and gentlemen, does not give you the right to commit fraud. We are law enforcement officers, all of us do work, every attorney general does work on fraud cases. We are pursuing this as we would any other fraud matter, you have to tell the truth, you can't make misrepresentations of the kinds we've seen here and the scope of the problem we're facing.

The historic alliance of state AGs demonstrates the depth of the issue and its importance to the nation’s response to addressing climate change. "The scope of the problem we are facing, the size of the corporate entities and alliances and trade associations [fighting science-based climate policy] is massive and it requires a multi-state effort," said Schneiderman.

AG Claude Walker of the U.S. Virgin Islands said Puerto Rico and the Virgin Islands are already "experiencing the effects of global warming," noting coral bleaching, the proliferation of seaweed and an increase in the severity of hurricanes as evidence. Walker castigated the oil industry for consistently putting profits over the planet:

It's troubling that as the polar caps melt you have companies that are looking at that as an opportunity to go and drill, to go and get more oil. Why? How selfish can you be? Your product is destroying this earth and your strategy is let's get to the polar caps first so we can get more oil. To do what? To destroy the planet further?

This particular legal narrative in America’s ongoing climate wars goes back to September, when InsideClimate News published the first installment of an exposé revealing that ExxonMobil was aware its primary product contributed to global warming. The following month, Schneiderman issued a subpoena demanding a wide range of documents from the company, including emails and financial documents dating back as far as 40 years.

In January, California AG Kamala Harris launched a similar investigation. The investigation now seeks to ascertain not only if the oil giant knew about the climate impact of the greenhouse gases associated with its activities, but if it knowingly propagated false information about climate risks among shareholders and the general public.

ExxonMobil has denied any wrongdoing.

Comparing the behavior of Exxon and other Big Oil firms to that of the tobacco industry in the 1990s (which also faced prosecution from state AGs), Al Gore said, “Commercial interests that have been, according to the best available evidence, deceiving the American people, communicating in a fraudulent way about the reality of the climate crisis and the dangers it poses.”

“Big polluters have done everything in their power to deny climate change. It is time for our justice system to take back the climate debate,” said Annie Leonard, executive director of Greenpeace, in a statement released after the press conference. “If the AGs rally behind a unified call, they can make history,” she said, noting that their efforts could spark an investigation by the Department of Justice, which launched a similar inquiry into Big Tobacco’s efforts to deceive the public about the link between smoking and cancer. In December, Leonard backed Bernie Sanders’ climate plan, saying it “shows that he has broken free of the corporate and 1 percent money that has held back climate policy for far too long.”

Katherine Sawyer, senior international organizer for watchdog group Corporate Accountability International, explained the similarity to the Big Tobacco investigations in an emailed statement following the press conference:

In the ’90s, investigations by attorneys general were the beginning of the end for Big Tobacco as we knew it and ushered in a series of lawsuits that shuttered its front groups, forced the release of internal documents, and held it liable to pay the high cost of its impacts on society. Just as a similar coalition did with Big Tobacco, this powerful coalition of state Attorneys General are leading the way in holding Exxon and the rest of the fossil fuel industry accountable for their decades of deception and protecting climate policy from their profit-driven interference.”

Hailing the newly formed coalition of the nation’s top cops "for standing strong against the fossil fuel industry," Sawyer also noted Exxon's "efforts to undermine the Clean Power Plan."

Though the Exxon investigation took center stage at Tuesday's press conference, the attack by Big Oil on the EPA’s Clean Power Plan (CPP) was the backdrop: Officially, the gathering was held to mark the occasion of the joint amicus brief the state AGs filed with the U.S. Court of Appeals for the District of Columbia, supporting the EPA’s authority to limit emissions from existing power plants through the CPP, one of President Barack Obama’s landmark initiatives in the fight to protect the climate. The CPP can save the average American almost $85 a year on their energy bill, reduce health costs for illnesses related to air pollution, prevent 3,600 premature deaths and 90,000 fewer childhood asthma attacks every year, and can help create 270,000 new jobs.

That authority has been vehemently rejected by the power industry and numerous states, several of which have filed lawsuits to block implementation of the plan, which would set a national ceiling on how much carbon dioxide the United States can emit, enforceable through federal law. The CPP’s ultimate goal is a nationwide 32-percent reduction in CO2 emissions from the energy sector, but its implementation has been delayed by the U.S. Supreme Court while the D.C. Circuit court considers challenges to the plan.

The overwhelming majority of the world’s scientists have long argued that the Earth’s surface temperature is unnaturally rising, primarily due to CO2 (and increasingly, methane) emissions from such massive contributors as the meat industry, coal-burning power plants and transportation. The proven impacts of global warming are many, from melting polar ice caps, rising sea level and extreme weather and food shortages, to increased disease transmission, the destruction of coastal economies and the rise of climate refugees and climate-related armed conflicts. However, even with evidence linking all of these effects with anthropogenic climate change, the issue remains starkly polarized and heavily politicized, with the fossil fuel industry, energy lobby, Republican lawmakers and other so-called climate deniers arguing that either the Earth’s average temperatures are not rising or that humans are not to blame.

Schneiderman was forceful in his defense of the investigation, pointing out that some Big Oil firms have already raised offshore oil derricks to account for higher sea levels and are even drilling in areas once beneath Arctic glaciers, many of which have melted due to rising temperatures. Yet he remained vague on any potential resolution he and his fellow AGs may seek if Exxon and other companies are found guilty of committing fraud. “Financial damages alone may be insufficient,” he said.

"This creates a huge sense of momentum,” said May Boeve, executive director of 350.org, in a emailed statement following the press conference. “Exxon may have been able to brush aside a few isolated inquiries, but with more states jumping on board, these investigations are sure to generate some serious waves. The Exxon revelations may turn out to be the largest corporate scandal in history. We'll be looking for the Department of Justice and many more cities and states to get involved."

AG George Jepsen of Connecticut added some important perspective on an issue that will have grave implications for the future. “It's time that we stand up ... and take on what is the most important issue of our generation,” he said. “We owe it to our children, our children's children to step up and do the right thing.”

[Editor’s note: In conjunction with the April 1 deadline, a broad coalition of groups interested in halting climate change and promoting clean air filed amici curiae, or “friends of the court” briefs, with the U.S. Court of Appeals for the D.C. Circuit in support of the Environmental Protection Agency (EPA)’s Clean Power Plan. Groups that filed include Amazon.com, Apple Inc., Google, Microsoft, Mars Inc., the U.S. Conference of Mayors, National League of Cities, two former EPA Administrators under Republican Presidents, the American Thoracic Society, American Medical Association, American Academy of Pediatrics, National Medical Association, American Public Health Association and the Catholic Climate Covenant.]

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