Closing arguments in the oil giant’s investor fraud trial presented two competing narratives.
NICHOLAS KUSNETZ reports for Inside Climate News
Lawyers for New York State and ExxonMobil wrapped up a landmark climate fraud trial on Thursday, shaping a tangle of testimony and evidence into competing narratives on whether the oil company misled investors about the risks it faces from climate regulation.
Jonathan Zweig, who gave the closing arguments for the New York attorney general’s office, described the case as a classic securities fraud trial that happened to be about climate change, which he said “may well be the defining risk for oil and gas companies like ExxonMobil in the coming decades.”
Zweig said the evidence showed clearly that Exxon had misled investors by downplaying those risks significantly.
Theodore Wells, the lead lawyer for Exxon, argued that the same evidence shows “that this case is meritless, that each and every allegation in the complaint is not true and not connected to the reality or the truth, and that ExxonMobil has done nothing wrong.”
The two sides actually agree on many of the core facts of the case, chiefly that Exxon used two different estimates for the cost to its business from future climate regulations.
The company disclosed one of those estimates in numerous public reports. A second estimate, which was lower than the public figure, was not disclosed to investors until 2014 when it appeared in one sentence in one report. Much of the case hinges on whether that disclosure was clear and adequate, or whether anyone noticed it at all.
The closing statements capped an investigation that began four years ago after reports by InsideClimate News and the Los Angeles Times detailed what Exxon knew about the impact of fossil fuels on global warming from its own climate science research decades ago. The proceedings have grown contentious at times—the attorney general’s office tried to have Justice Barry Ostrager removed from the case last year after learning he owned shares of Exxon stock. But Ostrager ended the trial by congratulating both sides for their diligent and professional preparations and performance. He has said he will issue a ruling before the end of the year.
While the case centers on discussion of climate change risks, the trial itself—and the legal questions the judge will decide—revolve around relatively narrow questions of New York securities law.
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