Exxon sued on climate change disclosure
Lawyers for Exxon Mobil
Corp. stood before a New York judge in August and told the state’s attorney-general to “put up or shut up” after spending three years investigating the company’s public disclosures about climate change, saying authorities should sue the energy giant or move on.
On Wednesday, New York chose to strike.
Attorney-General Barbara Underwood filed a fraud lawsuit against Exxon in Manhattan, accusing the firm of misleading investors about how future regulations could impact its business. The complaint capped a tumultuous investigation that reached the highest levels of Exxon’s leadership, including former chief executive Rex Tillerson.
Central to the probe and the lawsuit are Exxon’s use of so-called proxy costs for carbon to calculate the financial impact of future regulations on the business. The costs are supposed to assure long-term investors including institutional shareholders and pension funds that they wouldn’t be taken by surprise. New York says it was a ruse.
“Exxon built a facade to deceive investors into believing that the company was managing the risks of climate-change regulation to its business when, in fact, it was intentionally and systematically underestimating or ignoring them, contrary to its public representations,” Underwood said.
Exxon spokesman Scott Silvestri called the lawsuit “tainted” and meritless.
“These baseless allegations are a product of closeddoor lobbying by special interests, political opportunism and the attorney-general’s inability to admit that a three-year investigation has uncovered no wrongdoing,” Silvestri said in an email.
The Irving, Texas.-based company in March lost a lawsuit in which it sought to have the investigation halted because the case was politically motivated.