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NY State alleges ExxonMobil knew risks of climate change and defrauded investors (esquire.com)
321 points by colinprince 15 days ago | hide | past | web | favorite | 116 comments



The sad irony is that the pattern of

- knowing the science enough to know they're contributing to others suffering

- knowing what might happen with reasonable certainty

- but compartmentalizing that awareness internally to avoid acting

- hiding it externally

- and keeping doing what they were doing

describes the reactions of most individuals about climate change.


And actively funding propaganda that delays action.


Also sounds exactly like what happened with tobacco companies, lead in paint/gasoline, etc.

It's like we never learn and then those who are in charge made rules to make it even harder to learn as we went forward.

Also that humans are terrible at existential threats.


The moral debate around climate change should center around what you just said. Either we are all compartmentalizing it, or we all honestly convinced of "no harmful effects worth worrying over." Most people that care about climate change have a lot of cognitive dissonance, trying to hold our institutions to a high standard but unable to act in a meaningful way.

Personally I believe that the amount of human suffering that will be caused by climate change will be small, but I'm unable to really discern whether motivated reasoning lead me to this conclusion. The evidence presented by both sides about the amount of human suffering that will be caused is highly questionable.


every item should be tax on how much money it would take to revert it back to it’s raw material and remove whatever air pollutants it produced. this is going beyond the carbon tax. such tax revenue can only be used on recycling or funding research on renewable energy or other energy sources like fusion.


It's not that simple and my guess is that the AG wont win it (neither do they care to)

Unless it can be demonstrated scientifically that humans are the primary cause of climate change (despite what you hear that causality is not established) I don't think there is any case what so ever unless some weird inconsequential settlement.

Also

A life without fossil fuel is a life most of us don't want to live.

So sure there are drawbacks with using fossil fuels just as there were with using wood or just as there is with dong or other lesser versions of fuel.

But the benefits far outweigh the drawbacks. We wouldn't have this conversation if it wasn't for fossil fuel.

Last but not least. This smells of politics, not of justice. NY is trying to push for a much more green profile. So it's likely to do with that probably as an attempt at getting de-blasio nominated (yes politics is that scruppules)


> life without fossil fuel is a life most of us don't want to live.

This is downright silly. Sure I have a cellphone, car but I don't live for those things. I live for the people around me, and they are not made of fossil fuel.


You don't just have a cellphone. You have ambulances, you have food, you have medicine, you have heat, you have buildings, you have more or less 80% of your surroundings based on fossil fuels. In other words, there would be much less people around you to live for if it wasn't for fossil fuels.

It's silly to claim you can live without which is why we don't and aren't even close to doing that in the rich countries.


We've had the technology to do all of that without fossil fuels for decades. We are close to doing it in rich countries today, despite both active opposition and the usual passivity of the status quo. Renewable energy sources are now cheaper than non-renewables, across the board, regardless of subsidies in either direction. England for the first time since the Industrial Revolution generated more power with renewable sources than fossil fuels this year. Norway, an oil exporter, is on a path to be entirely fossil fuel free soon inside the country's borders. Germany and even the US have also had periods where large amounts of the country's energy grids were entirely renewable.

It's silly to claim we are entirely reliant on fossil fuels for all our modern conveniences, when everything but cars/trucks/shipping is mostly energy source independent and the grid is overall greener than it has ever been in decades, and getting greener. (And we certainly have the technology to solve cars/trucks/shipping today, too.)


You can call it silly all you want it doesn't change the facts.

We aren't close to doing anything even in rich countries. Wind and solar is less than 1% of world energy. And even in countries that are rich the cost is pushed onto the consumers just ask Germany.

https://www.iea.org/weo/?fbclid=IwAR3eH1AFcRSPSEit8JINLCMvE_...


I’m reminded instantly of the article “Everything Everywhere is Securities Fraud” [1]

Oh, look, Matt Levine actually references this case at the top of that article. Unexpected recursion detected.

[1] - https://www.bloomberg.com/opinion/articles/2019-06-26/everyt...


Liars who make money on their lies are fraudsters, and fraud needs to have criminal repercussions

Yes, LOTS of people lie to make money. Yes, all those people are doing something wrong. And yes, that wrong thing is bad enough for society that we should punish it.

"Everything" is not fraud. Telling lies to make money is the definition of fraud. If you think that describes "everything" that happens in the economy... Well, stop telling lies.

And yes, lots of fraud is impossible to prove because the actors know the law. Patent trolling comes to mind.

And yes, lots of powerful people commit fraud throughout their career in impunity. Fraud is normal.

However, the normalcy of fraud and of getting away with deviancy does not make fraud acceptable.

I'm routinely astounded by how surprised people are to learn that telling lies to make money is illegal.

Tech in particular needs to do something about the fact fraud has reached meme status in our industry ('fake it till you make it').


I don't think people are surprised that it is fraud, just that there isn't a better way to prosecute it. If ExxonMobil's board hired a hitman to kill a competitor's CEO, I think people would hope that the response is to prosecute the board for murder and not merely for fraudulently claiming their company is valuable when they were actually relying on destabilizing their competitor. No one's defending the fraud, it just doesn't seem like the most important problem here.


“What we are facing now is a person whose crime dwarfs all of the crimes ever committed in human history. We were unable to find a single law applicable to his crime. So we recommend that the crime of Extinction of Life on Earth be added to international law, and that Rey Diaz be tried under it.”

— Cixin Liu, The Dark Forest


Retroactive legislation is usually frowned upon or outright banned in many jurisdictions.


I believe https://en.wikipedia.org/wiki/Crimes_against_humanity is literally true in this case.


Criminal negligence then? Sedition? They internally predicted catastrophic damage to society. It is obscene.


For some context, in the novel Rey Diaz tried to hold back a alien invasion by threatening to blow the whole solar system into the sun with nuclear weapons.


Assume for sake of argument that climate change is catastrophic and that ExxonMobil knew as much. We’re to believe that the real victims here are ExxonMobil’s investors?


An occasional plot point in fiction is to have some kind of investigator buy a single share in a company to uncover what they're really up to.

If they told investors that climate change was a major threat (as they may have been legally be obliged to?) then that information would have become available to the wider public.

Also, we allow public companies to exist knowing that they will be more open and transparent than private companies. If a private company does something evil, we can knock on the owner's door. You can't do that if it's public. It's a trade-off - we don't hold an owner responsible but there's a requirement for more disclosure. If they're breaking the rules that usually stop public companies turning evil, then it's very clearly a concern.


> Assume for sake of argument that climate change is catastrophic and that ExxonMobil knew as much. We’re to believe that the real victims here are ExxonMobil’s investors?

The law doesn't really subscribe to the theory of exclusive victimhood any more than it does to the theory (also popular in internet discussion groups) of exclusive responsibility; for any individual act the law has no problem with their being a number of different responsible parties (and even different classes of responsibile parties) and/or a number of different (classes of) victims.


No, just that the investors are the first victims to sue.


Also, the most likely set of victims to win in the current political climate.


They might not be the greatest victims but they certainly are some of the victims. They invested money in a company whose business model was unsustainable. The company knew that the business model was unsustainable but did not tell them.

In the US publicly traded companies have a duty to let their shareholders know all material risks to the company that the company is aware of.

The response to this is usually “but everyone knows about climate change”. But that is not the case. By now everyone has heard of climate change but many still don't believe it/dispute it. You can call these people stupid and uneducated but they are entitled to the same protections under the law which means that they have a right to be alerted to the potential danger to their investments posed by climate change. I am sure even the more ignorant would pay more attention if the climate change warnings came directly from an oil company they are thinking of investing in.

Furthermore, the NYAG says he has evidence that Exxon knew it was happening as long as 30 years ago. Back in the late 80s and early 90s climate change was far from settled thing.


> Back in the late 80s and early 90s climate change was far from settled thing.

I was under the assumption that the basic tennets of climate change were well understood by scientists more than 100 years ago. While the climate models have been developed only recently, enabling more accurate predictions, climate science is centuries old as it relates to understanding human impact on our climate.

Climate science was as "settled" in the 80s and 90s as it is today. Yes, the predictions are more accurate today, but the confidence that we are changing Earth's climate was just as strong then as now.

I remember in 1997-8 being taught in US public schools, in no uncertain terms, that we are changing the climate, warming the atmosphere into a runaway greenhouse effect. This was in the US South in a very red state that mostly denies climate science today. The only way to interpret the idea that climate science was "less settled" in the 80s 90s is political. It has been "settled" for 100+ years in rational scientific discourse.


Perhaps i misspoke. By less settles i meant that it was less known about and believed among the average population rather than as a scientific consensus. The relevant discussion here is corporate risk disclosure. If a corporation says it does not need to disclose a known risk because everyone knows about it it has to be something that is really universally known and universally believed to be true. Something like gravity. That certainly was not and it is not true about climate change. There are still people that believe it is not true and there were much more of them in the 80s and 90s. We are not talking about scientific consensus here. The exxon stock was not sold exclusively to scientists. We are talking the average joe.


> believed among the average population

Yes, and 45% of the population believe in ghosts [0], 29% of Americans believe Obama is a Muslim [1] and 40% of Americans believe the Earth is less than 10,000 years old [2], so frankly I put very little stock in what the average Joe thinks these days.

There has been a constant propaganda campaign waged in the media by people who have an interest in maintaining the status quo regarding extractive industries, and a rather large proportion of the population has eaten it all up.

---

[0] http://big.assets.huffingtonpost.com/ghosttoplines.pdf [1] https://www.washingtonpost.com/news/acts-of-faith/wp/2015/09... [2] https://www.livescience.com/46123-many-americans-creationist...


And this kind of comment is where the disinformation starts. Looking at history not even at climate science journals settles the argument: Earth Summit was 1992, Kyoto Protocol was 1997. Climate change already was enough of a thing to have the international community come together for treaties saying we need to mitigate and work towards saving the planet.


> By now everyone has heard of climate change but many still don't believe it/dispute it.

Nobody disputes climate change since climate has been changing for billions of years, just the human contribution towards it. Also, many people consider the distinction important...


Since you can’t sue a company for propaganda, spreading lies, lobbying politicians, willfully destroying the earth and killing humans indirectly despite knowing what your product does, this is the best possible option.

It’s also peak capitalism, where only investors matter.


Seriously, I understand everyone currently would sell their mother to lure in investors, but aren't they the one who take primary responsibility even? Ethically I would say yes, but laws seem to fail here again.


In a capitalist system, they’re the only people who really matter, so it’s unsurprising.


A likely factor in this lawsuit is the excellent investigative series done by InsideClimate News. They were a finalist for a Pulitzer for this series.

Part [1] covers the beginnings of Exxon's own climate research in the late 70s, and the findings of their scientists, which was approximately accurate to modern climate behavior today, 40 years later. Back in 1979, Exxon outfitted some of their ships with equipment to detect CO2 absorption in the ocean along their routes; Exxon was, at the time, one of the leading climate research organizations in the world.

Part [2] covers some of Exxon's research and findings in more detail.

Part [3] describes the climate models that Exxon's researchers developed in the early 80s, and some of the early decisions that corporate leadership made to downplay the implications of these models and search for other poorly-founded ideas that might rebut them.

Part [4] is about Exxon's discovery of and response to a major CO2 source in the South China Sea.

Part [5] briefly talks about synthetic fuel technology under development in the 1980s and the impact that early climate science might have had on exploring that technology.

And [6] finally gets to the meaty part where, after well over a decade of their own research efforts were telling them otherwise, company executives began a misinformation campaign through the 90s and 2000s, downplaying the certainty of climate science and its potential effects.

You can also explore a pile of internal Exxon documents yourself [7].

The comparison between energy companies and tobacco companies is apt. There is no doubt that, even as Exxon duped an entire legion of people into believing that climate science was "uncertain", internally they had solid research demonstrating the effects their practices would have on the global climate.

It's fair to say that climate change skeptics have been arguing against Exxon's own research. They just didn't know they were arguing against Exxon's research, because Exxon lied, repeatedly, to the public.

Their executives did not want to accept the potential liability associated with the findings of their own internal research.

[1]: https://insideclimatenews.org/news/15092015/Exxons-own-resea...

[2]: https://insideclimatenews.org/news/16092015/exxon-believed-d...

[3]: https://insideclimatenews.org/news/18092015/exxon-confirmed-...

[4]: https://insideclimatenews.org/news/08102015/Exxons-Business-...

[5]: https://insideclimatenews.org/news/08102015/highlighting-all...

[6]: https://insideclimatenews.org/news/22102015/Exxon-Sowed-Doub...

[7]: https://insideclimatenews.org/search_documents?topic=All&pro...


Thank you for posting. It is very important to put into context how badly fossil fuel companies may have knowingly screwed us.


It's also important to put in context that they were busy screwing us while a large chunk of the new generations haven't even been born

Does this stuff ever get us anywhere? I just looked at the AG's website and it looks like we're constantly suing every high powered entity in America: https://ag.ny.gov


I don't feel like it does. Everytime I see a NY or CA AG making these cases, I just mostly ignore them and assume they're using it as political grandstanding to run for governor or US Senate to then make the leap for a presidential bid.

At least IL AGs havent been dumb enough to do this. They know if they go national, the corruption will be exposed and they'll go to jail. Typically, if they keep the corruption in state, they can get away with it. We, the people of Illinois, have largely become desensitized to corruption and has become a running joke. I mean, something like 6 or 7 of our last 11 governors have served time for corruption, and that spans both parties.


i recommend this essay about how absolutely crazy the AG role actually is: https://repository.jmls.edu/cgi/viewcontent.cgi?article=1913...


Now explain the New York AG and why it seems others are twiddling their thumbs in comparison

Or perhaps they are active against multinational corporations but arent physically close enough to the media for it to ever surface?


The New York AG has the obvious advantage of having jurisdiction over the world's financial capital. Other states may often lack the nexus with the business to have standing.

Then, it's simply a matter of experience: corporate and especially financial law is beyond complex, and they have the expertise, plus the financial resources, to investigate such cases. New York law is also similarly ahead.

And, of course, the majority of Attorneys General are currently Republican and have absolutely no interest interfering with corporations unless those happen to be involved in journalism, renewable energy or other despicably altruistic lines of business.


Many of the undertakings that happen at the state level require a functioning federal government for them to go anywhere. We do not have a functioning federal government, so here we are.


Our federal government works shockingly well for its size and scope. Dealing with the State Dept to replace a passport at the last minute was one of the best customer service experiences I've had in years.

The parts that are not functioning are the legislature and executive branch.


The State Dept is run by the executive branch.


You're right. It would've been more correct for me to say the part that works well is employed and non-political, while the dysfunctional part is composed of mostly elected officials and their appointees.


AFAIK these cases often force companies to stop their misbehavior and offer concessions. For example, have you ever felt that it's not an accident that you don't get advertised speeds from your ISP? https://www.theverge.com/2018/12/18/18146210/charter-spectru...


Yes. During the Bush administration, for example, it was the NY attorney general Spitzer that held financial institutions accountable for their crimes as the president was determined to let them get away with everything.


I hate fossil fuels as the next guy, but

a. we need them as there are no alternatives currently

b. everybody with just a little gray matter under their skull knew that burning fossil fuels is not good for the environment, and our health.


I think that there are some alternatives, but they definitely aren't feasible in many parts of the world at this point.

That being said, I do think one could make a strong argument that Exxon lied to investors through omittance of a truth that they new. Not that they were harming the environment, but that they misrepresented risk to the business due to environmental harm.


Source article: https://insideclimatenews.org/news/24102018/exxon-climate-fr...

Are there previous examples of a lawsuit over a company misleading shareholders about potential future liabilities, where the liabilities are still unknown? We still don't know how much business Exxon might lose, or how much its penalties might be, as a result of climate change. So how would you calculate which shareholders lost how much?


That's not the source. That article merely rehashes the AG PR[1] and doc [2] from 2018.

This article just discusses preparations for the opening arguments due to commence.

[1] - https://ag.ny.gov/press-release/ag-underwood-files-lawsuit-a...

[2] - https://ag.ny.gov/sites/default/files/summons_and_complaint_...


It is not the the future liabilities are unknown. It is that exon had information that it new that would effect those liabilities and didn’t inform the stockmarket. It isn’t up to the company to work out how much that they will loose but it is up to Exon to give the market the information they need in order to make an informed decision.


There's some chance that governments worldwide will decide the costs of transforming the energy base and applying conservation measures, outweigh the benefits of possibly avoiding the increase of 2°C and attendant problems. In that case, Exxon's internal proxy GHG cost projections don't look wrong. Whether it's a securities law violation, different matter.



Interesting, use that money to fund R&D to reduce CO2 in atmosphere?


We already know very well how to remove CO2 from the atmosphere, but we're doing the opposite. For example, in the EU we're adding "biofuels" to gasoline for stupid reasons and part of that comes from palm oil, which is produced where rainforests are cut down first. So we're not only trying to save the dirty ICE, but we're also destroying rainforests in order to look "green".

I don't expect anything good to come from politics under the pretense of saving the planet.


I hope NY State wins the lawsuit. Typically investor fraud lawsuits have higher penalties. If it was workers rights that wouldn't be a problem for them.


At first blush, this seems like rough justice to me.

Based on cynical assumptions, I'm guessing that the NY AG actually has an axe to grind about ExxonMobil's political/PR efforts regarding climate change, but couldn't pursue them because of First Amendment protections.

And so the AG is grasping at other legal straws within the same general topic area.


They knew that their product would mess with the climate and they not only hid this information, but actively lied to convince people of the opposite, all so that they could make more money. And they made an incomprehensible amount of money. This sure sounds like fraud to me, and people have gone to prison for far, far less. Madoff got 150 years in prison for fraud equal to just a couple years of Exxon’s profits.

Rough justice? Maybe for the victims. Exxon should feel very lucky if it stops at losing this lawsuit. Of course, this is the US, where real punishments are reserved for individuals, and large companies are effectively outside the law.


Even if it's neither one, I'd still rather someone with political/socioeconomic power spend time arguing for sound science, rather than against it.


Lying to investors is a serious crime. What you're saying is that Exxon actually committed a much more serious set of bad acts -- acts that may be constitutionally protected -- and that "lying to investors" doesn't seem as serious when compared with Exxon's real bad acts. But that's insane. It's like saying that I shouldn't be prosecuted for arson if setting someone's house on fire also kills them.


Sorry, let me clarify. My impression from reading the article was that Exxon's communications to shareholders weren't materially lies in any relevant legal sense. I.e., that trying to prosecute them is at the very least a legal stretch, or at worst a case of malicious prosecution.

If I misunderstood the article or missing something crucial in it, I apologize.


I guess that will be up to the courts to decide. I'm guessing Exxon will argue strenuously that this is true, there will be more discovery to decide whether this is accurate, and (in a perfect world) the right thing will happen :)


It seems like the big distinction is going to be between "they didn't tell investors that they were a huge climate change contributor" and "they didn't tell investors how much money they'd lose out on from stricter environmental regulation".



When will Saudi Arabia, Russia and Norway be sued in an international court to pay for the damage they did (and continue doing every day?


The main pic in the article strangely looks like a nuclear power plant.


All sorts of power plants have those large cooling towers which have become symbols of nuclear power plants. To me it looks more like a natural gas plant, what with those smaller exhaust stacks next to the cooling towers.

See "natural draft cooling towers": https://en.wikipedia.org/wiki/Cooling_tower


What's the likelihood on this changing the industry as a whole?


The obvious lesson would be not to try to find out if your business has enormous environmental consequences.


So it's not that they've endangered the public, or maybe even the environment. It's that they deceived shareholders.


I think they’re using an interesting legal strategy here. They can use shareholder fraud to have legal standing to pull them into court, but the case prema facie rests on the acceptance of climate change.


Yes. I agree. It's the Al Capone strategy. But the fact remains, shareholders are more protected than the environment and/or the public.

We're 20 yrs into the 21 century FFS. You'd think we'd woken up already.


Who else would sue? The EPA, which is currently headed by a self-professed climate change denier?

I would be surprised if the NY AG didn’t run for president some day. They clearly seem intent on finding creative ways to do others’ jobs. E.g. the sting on supplements that’s didn’t contain their supposed ingredients (FDA, which should at least close loopholes in this kind of fraud), promises to prosecute Trump for tax evasion (IRS), and fraud over climate change (EPA)


Does it rely on acceptance? If ExxonMobil's research indicated their business had serious risks relating to climate change, and they failed to disclose those risks to shareholders, does it matter whether their research later on turned out to be right or not? Isn't the main claim here that they chose not to disclose information that they fully believed was correct?


Luckily Exxon can’t deny climate change based on their own research done the past couple dozen years.


Unfortunately environmental protection laws are relatively weak in this country. Fortunately shareholder protection laws are relatively strong. So the attorney general, like a good lawyer, goes for the cause of action that will give him a high chance of success.


Shareholders are the public, it's a public company.


That's true, but it's very much biased towards the rich[1]. I think what the parent is trying to say is that the only reason this issue got legal action was because the rich were the primary victims. Had it been some other public issue that doesn't disproportionately affect the rich (eg. fracking/mining contaminating ground water), there wouldn't be similar action.

[1] https://finance.yahoo.com/news/the-richest-1-own-50-of-stock...


If this were about shareholders, it would be a shareholders lawsuit, not an attorney general lawsuit. This is about (in theory) distorting the public market through fraud.


Nice job dehumanising anyone who is not well-off enough to afford risky investments. Vast majority of people who participate in this system will never be able to own shares by design. So 80-90% of people are not the public?


Shareholders are a subset of the public. I'm probably a member of the class, because I likely hold some shares of Exxon indirectly through index funds.


> "Shareholders are the public, it's a public company."

Yes, they are a subset of the broader public, but it's unlikely they are a representative sample of the whole. In fact, being shareholders immediately bakes a bias into their thoughts and actions. That bias alone separates them from The Public.

Yes, they are members of the public. No, they are not synonymous with The Public.


> So it's not that they've endangered the public, or maybe even the environment.

And they haven't. You did. (Plural You if that wasn't obvious.)


sounds like a 5 trillion settlement would be appropriate in this case...


Probably even more than that, when you consider how many more years the planet will be dealing with Exxon's BS, even if they were to cease operations today.


The company knew the physical ramifications from at least the 1970s, suppressed that knowledge, and now we are locked into decades their product manifested for many decades. Extractive industry - oil, coal, methane needs to have ended decades ago. We are climatically locked in for insane destabilization


> even if they were to cease operations today

I would be surprised if a 5 trillion fine would not achieve that goal...


What a bunch of pandering nonsense.


I'm super worried by these lawsuits. Instead of forcing the oil industry to invest in cleaner energies, to clean the atmosphere by for instance paying for planting massive amount of trees, or even to extract oil more sustainably... They want them to pay investors that were deceived by a fact everybody fucking knew for decades.

Makes me feel we're doomed and incapable of focusing on real challenges.


It's probably a law issue. Is it illegal to lie and deceive to make money? No. Is it illegal to destroy the Earth's eco system? Only if it's intended as an act of terror. Is it illegal to mislead the share holders? Yes. So that's the crime they can prosecute.


> Is it illegal to lie and deceive to make money? No.

What, really? Isn't that the definition of fraud?


> Instead of forcing the oil industry to ...

It does not have to be "instead". Can be in addition to. These things are not mutually exclusive. NYAG does what they can in their power.


Very true!

This is ridiculous. For decades, New Yorkers, like all Americans, have enjoyed the benefits of cheap energy. Exxon and other oil companies are giving consumers what they want.


You could make the same argument about tobacco companies and it would be equally weak.

Even if this case were about whether Exxon was supplying a demand, which is dubious (most of their consumers were industrial, and individuals had no other options), they still suppressed research about the environmental impact of the product.

You can't argue "free market" when the seller is part of an oligopoly and abused its enormous power to misinform the public and buy politicians.


They are getting sued for allegedly lying to their investors. How does them continuing to sell oil to consumers have any relevance?


There is no evidence that markets reflect what people want. It's just religiously taken for granted.

Even though I shouldn't try to disprove anyhting that hasn't been proven in the first place. Think about this:

When anyone purchases anything there will always be a million things they would disapprove about the product (how it's produced, how its workers are treated, how environment friendly it is, how much advertisers lie about it, what the company does with profits, does the company use unfair competition practices, does the company avoid taxes and so on and so on) but purchase it anyway because there is no alternative. The critical error and monumental stupidity is to use this purchase as a signal of approval of everything the consumer actually disapproves of.


They lied to the public about side effects of their product. That's ridiculously illegal.


Maybe they did, but this lawsuit isn't about that. The lawsuit claims only that they lied to investors about how they were managing the financial risks of increased climate regulation.


Do consumers want a ruined planet?


After seeing the absolutely bonkers car culture that America has, then yes. At least yes as an implicit result of the lifestyle they cannot or will not stop.


> > Do consumers want a ruined planet?

> After seeing the absolutely bonkers car culture that America has, then yes.

The planet is a lot more than just America.


Hasn't Exxon been rather profitable for the last 40 years? How have the investors of 1979 lost out?

In any case, my understanding is that all of Exxon's research was publicly available, so investors could look at it and judge for themselves what they thought the risks were. The idea that Exxon executives were supposed to make their own scientific determination regarding the magnitude of the effect of CO2 on climate - an issue that has since then been the subject of 40 years of intensive debate in the scientific community - is absurd.

Yes, absurd. This is not a good-faith law suit. It is political intimidation and extortion.


Exxon has been profitable but they allegedly did it by committing fraud. They allegedly knew the magnitude of the effect of CO2 on climate, and allegedly conspired to cover it up. Part of the reason there is "intensive debate" is because of Exxon's cover up. It wouldn't have been much of a debate without it. Therefore, Exxon was purposefully redirecting the efforts of investors to understand the risks that the company faced.


The suit alleges that the investors were defrauded - not the public, or some such. (That would also be absurd, but it isn't relevant anyway, so no point arguing about it.)

But the investors made lots of money. It doesn't make sense.

The idea that anything Exxon did had a major influence on the debate about the effect of CO2 on climate is ridiculous. Many billions of dollars have been spent on climate research by governments. Are we to believe that a few scientists at Exxon had it all figured out 40 years ago? And then because Exxon executives didn't decide their product was evil and therefore exit the industry, nobody else realized the truth, even though the reports by the Exxon scientists were published...?

It doesn't make sense.


Fraud is making money by lying. The fact that the investors made money doesn't negate the fraud. They were unaware of risks that the company knew about. Public companies (emphasis on public) are required to reveal to all investors the risks of investing in the company. Read any prospectus and you will see that they don't generally hold back, and in many cases go into specific and extensive detail on known risks.


But the possible effect of CO2 on climate was not a secret. It had been widely debated for decades even in 1979.

Now, it is true that companies sometimes state widely known information in their annual reports. Things like "the company's profitability could be affected by a change in consumer tastes that reduces demand for our product". (Not followed by any actual analysis of how likely this is, I note.) I assume such nonsense is due to lawyers trying to defend against other lawyers whose ethics don't deter them from filing lawsuits like this one.


It's been "not a secret" for a very long time. Scientists were meaningfully speculating on the effect that spilling CO2 into the atmosphere would have since the (very late) 19th century.

Here's an old scientific article talking about it, if you're interested. [PDF] http://www.rsc.org/images/Arrhenius1896_tcm18-173546.pdf

Amazing that we have had so much time to think about this problem.


>Exxon and other energy companies knew as long ago as 30 years that carbon emissions were becoming perilous to the planet.

This is ridiculous.

No one knew about climate change 30 years ago. A small number of scientists were aware of the possibility of climate change - it took some 30 years of research, heavily dependent on modeling capability which was only really unlocked in the last decade or so, to come to any sort of alarmist consensus, not to mention less than 30 years ago the consensus was one of global cooling.

Sure, in hindsight, it all seems obvious, but extraordinary claims require extraordinary evidence, and we're talking about terraforming a planet on the scale of 100 years. You'd be crazy to believe in such a thing without some hard data to back that up.

Meanwhile let's ignore that society, globally, has advanced - technologically and socially - on the back of petroleum fuel. We all may be paying a price, but we are all partaking in the reward.


>This is ridiculous.

It's not ridiculous. I was taught about the carbon cycle, greenhouse gasses, and climate change in a United States public high school in 1993. 26 years ago.

>Meanwhile let's ignore that society, globally, has advanced - technologically and socially - on the back of petroleum fuel.

Sure, but society has provided massive subsidies (both direct and indirect) to carbon-based fuels. Had we not provided those subsidies, society would be much better off.


>It's not ridiculous. I was taught about the carbon cycle, greenhouse gasses, and climate change in a United States public high school in 1993. 26 years ago.

Climate is a complex, chaotic system. Again, there was no certainty regarding warming without the decades of research, data gathering, and modeling that followed. Knowledge of the carbon cycle and greenhouse potential is not enough alone to prove that the planet is warming from human activities. And, again, 20 years ago the consensus was that of global cooling, to emphasize the degree of uncertainty in the historic consensus. You're underestimating the gravity of the notion that we are terraforming, modifying global climate, which normally changes over 10^4-10^6 years, on the scale of 10^2, 2-4 orders of magnitude difference. No time in history have humans even been able to do such a thing, let alone had they reason to believe that it were even possible.

>Sure, but society has provided massive subsidies (both direct and indirect) to carbon-based fuels. Had we not provided those subsidies, society would be much better off.

Much better off without fuel for local and global shipping and power generation and raw material for plastics?


> Much better off without fuel for local and global shipping and power generation and raw material for plastics?

No. That's an absurd characterization of my position. I do believe we're much better off when the market, absent direct and indirect subsidies, finds the most efficient solution. That _may_ mean less shipping, more efficient power generation (trading CapEx for OpEx), and more efficient use of plastics.


You really should read through Exxons internal documents that have been disclosed as part of this process. They far exceed what you are describing in terms of uncertainty. Not only did they conduct a mini IPCC to evaluate the public science they conducted their own original research. Then based on all of this they drew up operational plans for the effect on their Arctic operations.


I have read them. These was the theoretical work of a handful of geoscientists working from the computational limitations of 70s-80s technology, and substantially limited data compared to what has been made available in the decades since.

The historic certainty of climate change is being vastly overstated, neglecting the critical role that petroleum has played in the development of modern infrastructure and society in a blind rush to find some evil to blame. Science is built on skepticism.


Fourier was already warning about climate change in the 19th century.


And the head of the Manhattan Project had concerns that the nuclear tests could ignite the atmosphere.

Science is far more than theoretical speculation. Grand claims require development of supporting theory and evidence. Even the consensus regarding climate change has been rather quick to form considering the enormity of the claims and how young the field of modern science is.




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