Media Investigations Reveal Exxon's Climate Deception, Prompting NY AG To Subpoena Company Records

InsideClimate News Published Six-Part Series Revealing Exxon's Early Knowledge Of Climate Change And Subsequent Shift To Promoting Climate Denial. InsideClimate News published a six-part investigation in September and October detailing “how Exxon conducted cutting-edge climate research decades ago and then, without revealing all that it had learned, worked at the forefront of climate denial, manufacturing doubt about the scientific consensus that its own scientists had confirmed.” InsideClimate's eight-month investigation was “based on primary sources including internal company files dating back to the late 1970s, interviews with former company employees, and other evidence.” [InsideClimate News, Exxon: The Road Not Taken, accessed 11/16/15]

LA Times Investigation Further Detailed How Exxon's Public Statements Contradicted Company's Research. The Los Angeles Times, in collaboration with Columbia University's Energy and Environmental Reporting Project, reviewed hundreds of documents and interviewed “dozens of experts, including former Exxon Mobil employees” for an ongoing series of reports on Exxon. An October 23 article in the series, headlined “How Exxon went from leader to skeptic on climate change research,” illustrated how Exxon, “a leader in climate research, [became] one of its biggest public skeptics” because the company “feared a growing public consensus would lead to financially burdensome policies.” [Los Angeles Times, 10/23/15]

New York Attorney General Is Investigating Whether Exxon Lied To The Public About Climate Change. The New York Times reported on November 5 that New York Attorney General Eric T. Schneiderman had “begun an investigation of Exxon Mobil to determine whether the company lied to the public about the risks of climate change or to investors about how such risks might hurt the oil business.” As The Times reported, Schneiderman issued a subpoena to Exxon Mobil on November 4 “demanding extensive financial records, emails and other documents.” The Times also reported that, according to people with knowledge of the case, the attorney general's investigation into Exxon started a year ago, but "[n]ews reporting in the last eight months," including the Los Angeles Times and InsideClimate News reports, “added impetus to the investigation.” [The New York Times, 11/5/15]

Washington Post Argues Against State And Federal Investigations Of Exxon, Dismisses Comparison To Tobacco Companies

Washington Post Editorial Prematurely Concludes: “Exxon Deserves Criticism, But It Didn't Commit A Crime.” On November 15, The Washington Post published an editorial titled, “Not a criminal offense”; the online version of the editorial, which was posted on November 14, had the headline, “Exxon deserves criticism, but it didn't commit a crime.” In the editorial, the Post addressed the media investigations by InsideClimate News and the Los Angeles Times, the New York Attorney General's investigation of Exxon, and calls for a federal probe of Exxon by the U.S. Department of Justice (DOJ). The Post said the media accounts of Exxon depict “a discouraging example of corporate irresponsibility,” but prematurely argued that Exxon's actions weren't “criminal” and don't rise to the level of the tobacco industry's behavior, which a federal judge ruled violated the Racketeer Influenced and Corrupt Organizations Act (RICO):

Late last month, environmental groups asked Attorney General Loretta E. Lynch to launch an investigation into Exxon Mobil. Then New York Attorney General Eric Schneiderman announced he would do so on his own, using securities and consumer fraud laws. Exxon's misdeeds, the environmentalists' letter states, “are reminiscent -- though potentially much greater in scale -- than similar revelations about the tobacco industry.”

That's quite an accusation. A federal judge found in 2006 that tobacco companies “consistently, repeatedly, and with enormous skill and sophistication, denied [facts about smoking's risks] to the public, to the Government, and to the public health community.” Moreover, the judge found, these companies “marketed and sold their lethal products with zeal, with deception, with a single-minded focus on their financial success, and without regard for the human tragedy or social costs that success exacted.” The history includes secret research, hiding documents and a shocking congressional hearing at which tobacco company executives insisted that nicotine isn't addictive -- in 1994, after decades of conclusive, if not always publicized, research linking tobacco to illness.

Exxon's story is more mixed. Starting in the late 1970s, the company invested in climate research, including the creation of the sorts of climate models that serve as a partial basis for the current scientific consensus on global warming. The firm changed course in the late 1980s, pushing back against the emerging scientific consensus rather than advancing it. Even so, the company released much of the research it helped conduct, it currently acknowledges climate change is a environmental risk [sic] and it favors taxing carbon dioxide emissions as a remedy. Moreover, emphasizing that predictive climate models are uncertain may be misleading, but it is not demonstrably false as is denying that smoking causes lung cancer.

Perhaps Mr. Schneiderman's investigation will turn up something damning. But there's also a risk whenever law enforcement holds the prospect of criminal penalties over those involved in a scientific debate. Legitimate scientific inquiry depends on allowing strong, even unfair, criticism of the claims that scientists make. As the Exxon investigations show, respecting that principle will not lead to positive outcomes in all cases. But it nevertheless demands that the government leave a sizable buffer zone between irresponsible claims and claims it believes may be criminally fraudulent. [The Washington Post, 11/14/15; 11/15/15 via Press Reader]

Flashback: In Early-To-Mid 2000s, The Post Shifted From Supporting Federal Tobacco Litigation To Increasingly Criticizing It

January 24, 1999 Post Editorial: Justice Department's Plan To Sue Tobacco Companies Is “A Sound Decision.” In its initial editorial on federal tobacco litigation, which addressed President Bill Clinton's announcement that the U.S. Justice Department was planning to sue tobacco companies, the Post stated that it was “a sound decision” that could benefit public health (emphasis added):

The President announced in the State of the Union address that the Justice Department is “preparing a litigation plan to take the tobacco companies to court and, with the funds we recover, to strengthen Medicare.” It's a sound decision. A favorable judgment could help to drive up the price of cigarettes and thus put another impediment in the way of smoking. And insolvent Medicare is the right repository for any proceeds, since it is the program through which the government paid most of the cost of treating tobacco-related illness that it would be seeking to recover.

[...]

A good political settlement might be a better outcome for both sides than a lawsuit. The “litigation plan” could in that sense become a bargaining chip.

This Congress will have before it a lot of health care proposals. Most will have to do with insurance. They will be earnestly debated. But none can benefit public health as these tobacco proposals. Public policy vis-a-vis tobacco ought to be toughened. If litigation can help produce the right result, then file away. [The Washington Post via Nexis, 1/24/99]

July 22, 1999 Post Editorial: Senate Bill Blocking DOJ Lawsuit Against Tobacco Companies Would Be “An Amnesty For Decades Of Misconduct.” In a July 22, 1999 editorial, the Post said “it's the attorney general's job” to determine whether tobacco companies' violations of law merit federal action, and that a Senate appropriations bill restricting DOJ's authority to file suit against tobacco companies “would be an amnesty for decades of misconduct” (emphasis added):

The [Justice Department] contends that the tobacco industry has engaged in intentional wrongdoing over the past 50 years in order to cover up the addictive qualities of its product. Industry misconduct, the argument goes, has resulted in huge federal health care bills. Normally, when a company fraudulently exacts such a toll on the taxpayer, the Justice Department seeks to recover some of that money. And that is what the department plans. It has asked Congress for $20 million for a planned suit. But the Senate appropriations subcommittee chairman, Judd Gregg (R-N.H.), seems to have other ideas. He inserted language into a committee report specifying that no money may be used for such a suit. The language would at least complicate the Justice Department's efforts, and it could be read to forbid a federal suit altogether.

The decision on whom to sue is a quintessentially executive branch power in which Congress has no legitimate role. If senators want to protect the tobacco industry's ill-gotten gains, they are free to change the laws under which Janet Reno is contemplating action. But it is the attorney general's job to decide whose violations of the law merit federal action. Moreover, when the attorney general plans a civil action against companies she claims have bilked the taxpayers of billions of dollars, it is not the place of any senator to seek to prevent the recovery of money that, in the judgment of the executive branch, lawfully belongs to the American people.

The amendment would not give the department the $20 million it has requested, but it would clarify that other money can be used for the suit. There can be no misunderstanding a vote to reject such a change. It would be an amnesty for decades of misconduct and a retroactive taxpayer subsidy for that misconduct as well. [The Washington Post, 7/22/99]

June 22, 2000 Post Editorial: Tobacco Industry Wrong To Claim DOJ Lawsuit Is “Frivolous.” In a June 22, 2000 editorial, the Post stated that the tobacco industry's lobbying campaign to defund the Justice Department lawsuit disproved industry claims that “the department's suit is frivolous and that the law provides no federal cause of action to recover smoking-related health care costs” (emphasis added):

The current effort by congressional Republicans to defund the Justice Department's lawsuit against the tobacco industry looks suspiciously like a brazen payback for the millions of dollars the industry has put in Republican coffers. Last year, Congress declined to appropriate money for the suit, so the department cobbled together funds from elsewhere in its budget and from other agencies of the government. This year the industry wants to prevent the department from getting more such funds from other agencies. Documents that tobacco giant Philip Morris has distributed around Capitol Hill show that the industry has scripted the current attack. Defendants in a lawsuit brought by the federal government, in other words, have been lobbying Congress to force the government to drop the suit--and the Republican leadership is playing ball.

The lobbying campaign gives the lie to the industry's publicly expressed confidence that the department's suit is frivolous and that the law provides no federal cause of action to recover smoking-related health care costs. [The Washington Post, 6/22/00]

September 30, 2000 Post Editorial: “We Have Reservations” About DOJ's Use Of RICO Against Tobacco Companies, But “It's Hard To Argue” Against It Given Congress' Unwillingness To Narrow Law's Scope. The Post first began to express some doubt about the DOJ investigation in a September 30, 2000 editorial, which stated that "[w]e have reservations about the use of RICO in areas distant from its original purpose," and that "[t]he government's tobacco suit would be more palatable if it stood on other legal footing." But the editorial ultimately concluded that the DOJ litigation was justified “in the face of Congress's own unwillingness over many years to narrow RICO's scope” (emphasis added):

When the Justice Department filed its suit against big tobacco last year, the companies dismissed the litigation as a political stunt. The federal government, they said, had no cause of action against them, and consequently the suit was frivolous. They went so far as to push Congress to defund the suit. Now U.S. District Judge Gladys Kessler has thrown out two of the government's four counts but kept two others. Her ruling shoots down two of the government's more creative legal theories, but shoots down the industry's rhetoric as hyperbole as well.

The government claimed it could recover smoking-related health care expenditures under the Medical Care Recovery Act and the Medicare Secondary Payer law. It also filed two counts under the civil provisions of the Racketeer Influenced and Corrupt Organizations Act (RICO)--a law designed to go after criminal organizations. We have reservations about the use of RICO in areas distant from its original purpose. But in allowing the RICO claims to go forward, the judge was hardly breaking new ground; expansive uses of RICO are a well-established feature of our legal landscape. The government's tobacco suit would be more palatable if it stood on other legal footing, but it's hard to argue that the government shouldn't use a potentially valid claim against the industry in the face of Congress's own unwillingness over many years to narrow RICO's scope. [The Washington Post, 9/30/00]

April 27, 2001 Post Editorial: “We Tend Not To Care Much For The Civil Racketeering Statute, Or At Any Rate The Stretching Of It.” In an April 27, 2000 editorial, the Post repeated its criticism of DOJ's use of RICO to sue the tobacco companies, arguing that the department was “stretching” the statute in a way that “was not intended.” Although the editorial said that the lawsuit helped “throw the industry on the defensive,” this time the Post did not argue in its own words that the end ultimately justifies the means, instead attributing that argument to "[p]roponents" (emphasis added):

An effort to persuade what had become a Republican Congress to pass a comprehensive anti-smoking law failed in the Senate, and efforts to regulate the industry under existing law -- the theory being that nicotine is a drug over which the Food and Drug Administration should exercise jurisdiction like any other -- were struck down in the courts. But the Clinton attacks helped to throw the industry on the defensive; the lawsuit, whatever its technical merit, was part of that.

Parts of the lawsuit have been thrown out; the part that remains is a civil racketeering charge. We tend not to care much for the civil racketeering statute, or at any rate the stretching of it to apply to cases such as this for which it was not intended. It allows near-criminal penalties to be imposed on a less-than-criminal standard of proof. Proponents say it might have helped to bring the industry to the bargaining table on the issue of regulation. [The Washington Post, 4/27/01]

June 21, 2001 Post Editorial: “We Don't Much Like” Using RICO Against Tobacco Companies, “So Maybe The [Bush] Administration Is Right To Abandon The Case.” The Post again stated its “reservations” about DOJ using RICO against the tobacco companies in a June 21, 2001 editorial, adding that “maybe the [George W. Bush] administration is right to abandon the case” and that a better “alternative” could be to push for more regulation (emphasis added):

[T]he [Bush] Justice Department [announced] that it will attempt to settle a Clinton administration lawsuit against the major tobacco companies. The rationale given was, partly, that the government thinks its case is weak and may soon get weaker as a result of a court ruling. We have our own reservations about what remains of the lawsuit; what seemed to us the government's strongest claims have been thrown out; and the two that are left rely on a civil racketeering statute whose use in cases such as this we don't much like. So maybe the administration is right to abandon the case, and certainly it is within its rights. But having said the case is weak, talk of settlement becomes awfully unconvincing. This is virtual abandonment, and the question then becomes, if not this, what? 

An alternative would be to press for Food and Drug Administration regulation of tobacco in more than the token form that some in the industry -- the industry giant Philip Morris Inc., for example -- have said they could accept. [The Washington Post, 6/21/01]

February 9, 2005 Post Editorial: “The Government Never Should Have Made Litigation The Centerpiece Of Tobacco Policy.” Several years passed before the Post editorial board returned to the subject of the Justice Department's lawsuit against the tobacco companies, in a February 9, 2005 editorial titled “Tobacco Sideshow.” Addressing a ruling by the DC Circuit Court of Appeals that the government could not recover hundreds of billions worth of company profits, the Post wrote that the ruling “underlines the truth that the government never should have made litigation the centerpiece of tobacco policy” (emphasis added):

A divided panel of the [DC Circuit Court of Appeals] held that the Justice Department's mammoth racketeering lawsuit against the tobacco companies cannot, even if it proves to be merited, produce the remedy the government seeks: the confiscation of $280 billion in ill-gotten profits. The result, if it stands, is a huge win for the tobacco companies. It also underlines the truth that the government never should have made litigation the centerpiece of tobacco policy.

[...]

[T]his case should not be the administration's only or even principal initiative regarding a product that kills more than 400,000 Americans every year. The central problem with the tobacco companies is not that they ran racketeering organizations -- though they may have done that along the way, as the government alleges, by engaging in 50 years of deception of the public regarding the effects of smoking on health. The main problem is that the product they legally manufacture today is exceptionally dangerous and dramatically underregulated. The current case could result in some useful new restrictions. But no court can establish the comprehensive and serious regulatory regime that is needed for tobacco products. Only Congress can do that, by approving long-overdue legislation to give the Food and Drug Administration authority over cigarettes.

[...]

[T]he Justice Department has spent huge sums of money to litigate this case. It would no doubt be satisfying to see the tobacco companies held to financial account for their myriad misdeeds over many decades. But the solution to the problem of tobacco and health does not lie in a courtroom. [The Washington Post, 2/9/05]

June 10, 2005 Post Editorial: “We Have Not Been Fans Of The Federal Tobacco Litigation.” In a June 10, 2005 editorial, the Post criticized the Bush administration for “scuttl[ing] its own case” against the tobacco companies, but also repeated its claim that the litigation is “a poor substitute” for comprehensive regulation of tobacco products (emphasis added):

Since taking office, the Bush administration has spent more than $100 million suing the tobacco industry. This week it scuttled its own case just as it was approaching judgment. The episode looks like politically inspired malfeasance, and it should be investigated.

[...]

We have not been fans of the federal tobacco litigation. Though it could bring about some useful curbs on industry conduct, it is a poor substitute for what's really needed: a comprehensive federal regulatory structure for tobacco products. That could be accomplished only through legislation, but the Bush administration has refused to seek reasonable regulation for tobacco products, pursuing litigation instead. [The Washington Post, 6/10/05]

August 19, 2006 Post Editorial: “The Tobacco Litigation ... Has Always Been Something Of A Sideshow.” In an August 20, 2006 editorial, the Post stepped up its criticism of the DOJ lawsuit, claiming that the litigation “has always been something of a sideshow” and repeating its call for better regulation (emphasis added):

[T]he tobacco litigation -- for all its high-profile twists and turns -- has always been something of a sideshow. If the government really wanted to reduce what Judge Kessler aptly termed the “staggering number of deaths per year, [the] immeasurable amount of human suffering and economic loss, and [the] profound burden on our national health care system” caused by smoking, the courtroom was never the right forum. The right approach was and remains for Congress to give the Food and Drug Administration regulatory authority over tobacco.

The chief problem with the tobacco industry, after all, is not that it has violated racketeering laws. It is that the industry manufactures a legal product of exceptional lethality that remains unregulated in all key respects. The kind of changes needed in this industry go far beyond what any court could realistically order: a comprehensive regulatory system that gives federal authorities control over ingredients, levels of addictive nicotine, and marketing. [The Washington Post, 8/19/06]

September 5, 2006 Post Editorial: Judge Demonstrated “Wisdom” In Ruling Tobacco Companies Violated RICO. Despite criticizing the DOJ lawsuit as a “sideshow,” and at one point even suggesting DOJ should “abandon the case,” in September 2006 the Post ultimately praised the “wisdom” of U.S. District Judge Gladys Kessler's August 17, 2006 ruling that the tobacco companies had violated RICO (emphasis added):

“Even after the Complaint in this action was filed in September 1999, Defendants continued to engage in conduct that is materially indistinguishable from their previous actions, activity that continues to this day. . . . [A]ll Defendants continue to market 'low tar' cigarettes to consumers seeking to reduce their health risks or quit; all Defendants continue to fraudulently deny that they manipulate the nicotine delivery of their cigarettes in order to create and sustain addiction.”

So wrote U.S. District Judge Gladys Kessler in her lengthy and impressive opinion last month in the federal government's racketeering lawsuit against the tobacco industry. Last week, two events demonstrated the wisdom of this harsh judgment.

First, the Massachusetts Department of Public Health released data showing that nicotine yields from cigarettes rose about 10 percent between 1998 and 2004 -- dramatically supporting Judge Kessler's contention that manipulations of the highly addictive chemical remain business as usual. 

[...]

The second event was a motion filed by the companies Friday, asking Judge Kessler to clarify that the ban she had slapped on such deceptive cigarette marketing terms as “light” and “low tar” did not apply overseas. The companies filed this brief knowing that the judge had ruled that the use of such terms was part of a massive pattern of fraud and deceit. Yet in a sign of the boundless rapaciousness of these companies in marketing death, they had the temerity to ask her not to apply her order “to sales wholly outside the United States.” If we can't continue to defraud Americans into killing themselves, they effectively asked, can we at least keep suggesting to billions of people abroad that some cigarettes are safer than others?

When a distinguished federal judge describes ongoing fraud, prosecutors should prick up their ears. More broadly, the lawlessness of this industry will persist as long as federal policymakers refuse to pass meaningful regulation that defines clear rules under which this deadly product can be made and marketed. As Judge Kessler herself notes, litigation will not ultimately bring this industry to heel. Only legislation can do that. [The Washington Post, 9/5/06; United States v. Philip Morris USA, 8/17/06]