On October 24, 2019, Massachusetts Attorney General Maura Healey filed a 200-page complaint against Exxon in Suffolk Superior Court, alleging violations of G.L. c. 93A, the Massachusetts Consumer Protection Act. The lawsuit is the culmination of a three-year long investigation that has been contested in state and federal courts in both Texas and Massachusetts.
The core legal theories espoused in the complaint resemble and also build upon allegations made by the New York Attorney General, which focused on statements Exxon historically made to investors. The trial in that case began on October 22, 2019.
The Massachusetts Attorney General argues that Exxon deceived both investors and consumers. As to investors, the complaint focuses on “systemic risk representations and omissions,” arguing that Exxon knew more about the risk to the environment and economy posed by fossil fuels than it shared with investors. Similarly, the complaint argues that Exxon was deceptive regarding “proxy cost misrepresentations,” which were Exxon’s communications to investors regarding how Exxon priced the cost of fossil fuel-related climate change into its own business decisions.
As to consumers, the complaint accuses Exxon of greenwashing by advertising the emissions benefits of certain fossil fuel products and exaggerating Exxon’s dedication to fossil fuel alternatives. These representations, the complaint argues, were “compounded by [Exxon’s] long history of intentionally sowing doubt and confusion in the minds of consumers about the link between fossil fuel and climate change.”
As to both the consumer and investor claims, the complaint seeks injunctive relief as well as civil penalties, the costs of investigation, and attorney’s fees. G.L. c. 93A, § 4 permits the imposition of a $5,000 civil penalty for each violation. This means that the potential penalty in the case is very high but also very difficult to calculate, as the Attorney General alleges that a violation occurred essentially every time Exxon communicated with a consumer or investor. In practice, where a very high number of violations is alleged, judges will tend to look to some other metric to determine an appropriate penalty amount, such as profits over a particular period of time or profits attributable to a certain course of wrongful conduct. As is often the case in climate change litigation, though, it is difficult to predict what a judge may do because there are few precedents to guide the shaping of a remedy. (This is not for lack of trying; the Attorney General conspicuously refers to Exxon’s historical advertising as “a tobacco industry-style campaign” and references the historical advertising practices of the tobacco industry roughly twenty times in the complaint.) Any damages or penalties to be paid by Exxon will be ultimately determined by a judge, although in G.L. c. 93A cases a judge may choose to empanel a jury for the purpose of fact finding.
The factual allegations of the complaint – across roughly 800 paragraphs – speak to the depth and breadth of the Attorney General’s investigation, and reference internal Exxon documents as far back as 1978. Exxon’s trial victory in New York in December 2019, however – where the Attorney General sought to show that Exxon had violated a state securities statute by misleading investors about its knowledge of climate change – is a potentially ominous sign for the Massachusetts Attorney General as the case proceeds.