By Karen Savage
ExxonMobil’s method for calculating the risks posed to its business by climate change have been “inconsistent and haphazard and did not identify any meaningful impact from potential climate regulation,” Massachusetts Attorney General Maura Healey’s office said in an amended complaint filed earlier this month in her fraud lawsuit against the company.
The AG’s amended complaint addresses several developments since the case was filed last year, most notably reacting to weaknesses in New York’s similar lawsuit against Exxon, which the company won last year.
The Massachusetts AG’s office filed its suit against Exxon before that verdict was handed down in November, alleging the company has known for decades that its products cause climate change, but misled consumers and investors about that risk.
After a nearly three-week trial, New York Supreme Court Judge Barry Ostrager ruled that the NY AG’s office failed to prove that Exxon deceived investors by using two proxy costs of carbon–one for internal use and one disclosed to investors—when calculating future climate risk. A proxy cost of carbon is a number representing the estimated future cost of climate regulation.
The Mass. AG’s initial filing included a similar claim, alleging that Exxon deceived Massachusetts investors by making “false and misleading statements to Massachusetts investors regarding its use of a proxy cost of carbon.”
That claim, one of two related to investor deception, has been dropped from Massachusetts’ complaint and allegations related to Exxon’s use of the proxy cost of carbon have been consolidated to fall under the claim that the company “misrepresented and failed to disclose material facts regarding climate change risks.”