On June 5, Massachusetts Attorney General Maura Healey filed an amended complaint in her climate fraud suit against Exxon Mobil, adding new allegations about the company’s concealment of its financial risks from a global pandemic. I haven’t seen it covered here, so this is just a quick and sloppy update on my wonderful MA AG Healey’s ongoing, righteous legal battle with Exxon:
The amended complaint, filed today in Suffolk Superior Court, highlights Exxon’s continued statements omitting, denying, and downplaying the risks that climate change poses to its business, as well as Exxon’s continued failure to disclose to investors the systemic financial risks from climate change. The COVID-19 pandemic has provided a real-time illustration of how shocks to the economy, including sudden drops in fossil fuel demand, have potentially dire consequences for companies like Exxon and their investors.
“The COVID-19 pandemic is giving us a sobering preview of the shocks to financial markets from climate change, and has exposed the massive risk posed to those invested in fossil fuel companies like Exxon by major events that cause global oil demand — and prices — to collapse,” AG Healey said. “Exxon knew about these risks decades ago but kept silent, instead making the calculated decision to mislead Massachusetts investors and consumers, hawking its fossil fuel products as good for the environment, and selling investors snake oil scenarios of ever-growing global demand for fossil fuels. Our amended lawsuit seeks to stop Exxon from engaging in deception and penalize them for this misconduct.”
For decades, Exxon has internally understood the risks that climate change poses to economic and geopolitical stability, including climate-driven human migrations, resource scarcity, wealth destruction, armed conflict, and escalating human suffering. (mass.gov)
The filing includes new research about potentially calamitous effects of climate change on the global economy and human life. The pandemic has upended economies and shown how Exxon’s business model is vulnerable to disruption from climate change. Nevertheless, Exxon still lies to shareholders about its future prospects. Exxon continued to predict increased demand even as it announced its first quarterly loss in more than 30 years and cut capital spending by 30% (ExxonMobil).
Extreme weather and the failure to address climate change were ranked as the top two global risks in the next 10 years, according to the World Economic Forum’s Global Risks Report for 2020.
J.P. Morgan, the world’s biggest fossil fuel funder, wrote in an internal research note that it could not “rule out catastrophic outcomes where human life as we know it is threatened.”
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Through all of this, Exxon has downplayed its exposure to sudden shifts in demand and prices, and forecast an increase in demand for its fossil fuel products, the AG’s office alleged in the new filing.
“ExxonMobil has repeated that message even in recent months, as the coronavirus pandemic substantially lowered global fossil fuel demand virtually overnight,” wrote the AG’s office, adding that the company has failed to adequately address and failed to disclose the “catastrophic risks that climate change presents to its business.”
(climatedocket)
AG Healey’s original charges, filed last November and renewed in the amended complaint, are that Exxon has been misleading consumers and investors for decades. Exxon has known since 1982 that their products would contribute to a catastrophic rise in CO2 emissions, which they accurately predicted would reach 415 parts per million in 2019—and yet they deliberately concealed this knowledge. The company lied to consumers and investors about its fossil fuel products and their disruption of the climate.
AG Healey’s original lawsuit also charges that Exxon’s greenwashing campaigns deceive consumers. Misleading advertising claimed that Exxon’s “Synergy” and “green” gasoline and diesel products “reduce energy use and CO2 emissions,” falsely marketing fossil fuel products as a climate solution. This false advertising violates Massachusetts law. Exxon has lost in court at every stage of AG Healey’s investigation. So far, so good.