The Massachusetts Supreme Judicial Court has cleared the way for state Attorney General Maura Healey’s investigation against Exxon to proceed, rejecting the company’s challenge to her probe into possible climate change-related deception.
In a 32-page decision issued Friday, the court affirmed a lower court decision compelling Exxon to comply with the investigation and turn over documents related to the impact of its products on climate change. The court also rejected a petition by Exxon asserting that Healey does not have jurisdiction over the company.
During oral arguments in December, an attorney for the oil giant claimed it did not sell gasoline in Massachusetts and said that individual franchises, not Exxon, are responsible for local advertising. Exxon also claimed its advertisements target a nationwide audience and don’t specifically target Massachusetts residents.
The court didn’t buy either argument, ruling that “through its control over franchisee advertising, Exxon communicates directly with Massachusetts consumers about its fossil fuel products.”
The ruling is the second this month to clear the way for investigations into potential climate fraud by Exxon. Federal judge Valerie Caproni recently dismissed a suit originally filed by Exxon in Texas and later transferred to New York. In that suit, the company claimed investigations by Healey and New York Attorney General Eric Schneiderman were violating the company’s Constitutional rights.
Healey praised the Massachusetts Supreme Judicial Court decision.
“For the second time this month, Exxon’s scorched earth campaign to block our investigation has been entirely rejected by the courts. In its decision today, our state’s highest court affirmed that Exxon is subject to our laws, and that our office has the authority to investigate,” Healey said in a statement.
Healey began the investigation in 2016 after investigative reporting revealed that for decades Exxon knew about and planned internally for climate change but publicly denied those risks.
Exxon did not immediately respond to a request for comment.
Through the investigation, Healey is attempting to determine whether Exxon violated Massachusetts consumer protection laws by misleading consumers on the impacts of its products on climate change and whether the corporation deceived Massachusetts shareholders by failing to divulge potential climate change-related risks to their investments.
Exxon responded to the investigation by filing suit against Healey in Texas and by petitioning a Massachusetts court claiming the lack of jurisdiction and alleging that Healey’s investigation was politically motivated.
Massachusetts Superior Court Judge Heidi E. Brieger ruled in January 2017 that “zealously” pursuing defendants does not make Healey’s actions improper and ordered Exxon to turn over documents requested in the investigation. She rejected Exxon’s allegation that Healey’s request was “overbroad, arbitrary and burdensome.”
The Supreme Judicial Court’s ruling, which refers to climate change as a “distinctly modern threat that grows more serious with time, and the effects of which are already being felt in Massachusetts,” affirms Brieger’s ruling.
“In order to determine whether Exxon engaged in deceptive advertising at its franchisee stations, by either giving a misleading impression or failing to disclose material information about climate change, the Attorney General must first ascertain what Exxon knew about that topic,” said the ruling.
As part of Healey’s investigation, she has requested transcripts of investor calls, evidence of internal discussions regarding the filing of Securities and Exchange Commission reports, documentation and research to back up public statements by former Exxon chief executive and now-former Secretary of State Rex Tillerson. She has also sought evidence to substantiate or refute claims made in several Exxon reports—including the 2014 Managing the Risks Report.
Healey is also asking Exxon to turn over internal scientific research, information related to public relations and media communication plans, as well as copies of communication with organizations such as ALEC, the American Petroleum Institute, the Heartland Institute, the George C. Marshall Institute, the Heritage Foundation and others.
Attorneys for Exxon contended that Healey’s request for documents going back to 1976 was overly broad, but again, the court disagreed.
“We find no support for Exxon’s position either in law (Exxon fails to cite any case) or logic. A document created more than four years ago is, of course, still probative of Exxon’s present knowledge on the issue of climate change, and whether Exxon disclosed that knowledge to the public,” said the court.
The decision is welcome news for Healey, who since starting the investigation has been forced to fend off a wave of Exxon’s legal pushback in Massachusetts, Texas and New York.
“Now Exxon must come forward with the truth, what it knew about climate change, when, and what it told the world. The people of Massachusetts—and people everywhere—deserve answers,” Healey said.
[…] Massachusetts Investigation of Exxon for Climate Fraud Can Proceed, Court Rules […]