MONEY & BUSINESS: California Sues Giant Oil Companies, Citing Decades of Deception
The state of California sued several of the world’s biggest oil companies on Friday, claiming their actions have caused tens of billions of dollars in damage and that they deceived the public by downplaying the risks posed by fossil fuels.
The civil case, filed in superior court in San Francisco, is the latest and most significant lawsuit to target oil, gas and coal companies over their role in causing climate change. It seeks creation of an abatement fund to pay for the future damages caused by climate related disasters in the state.
The lawsuit targets five companies: Exxon Mobil, Shell, BP, ConocoPhillips, and Chevron, which is headquartered in San Ramon, Calif. The American Petroleum Institute, an industry trade group based in Washington, is also listed as a defendant.
Seven other states and dozens of municipalities have filed similar lawsuits in recent years. But the California lawsuit immediately becomes one of the most significant legal challenges facing the fossil fuel industry.
Beyond being the most populous state in the country, California is a major producer of oil and gas, and its attorney general’s office has a track record of bringing landmark cases that are emulated by smaller states. California is also on the front lines of climate change fueled extreme weather, with wildfires, floods, sea-level rise, searing heat and even tropical storms battering the state.
Exxon, Chevron, Shell, BP, ConocoPhillips and the American Petroleum Institute did not immediately reply to requests for comment.
The lawsuit, brought on behalf of the people of California by the state’s attorney general, Rob Bonta, was filed late on Friday. It claims that starting in the 1950s, the companies and their allies intentionally downplayed the risks posed by fossil fuels to the public, even though they understood that their products were likely to lead to significant global warming. It alleges that Exxon, Chevron and the other companies have continued to mislead the public about their commitment to reducing emissions in recent years, boasting about minor investments alternative fuels while reaping record profits from the production of planet-warming fossil fuels.
“These folks had this information and lied to us, and we could have staved off some of the most significant consequences,” said California Gov. Gavin Newsom. “It’s shameful. It’s sickens you to your core.”
The lawsuit claims that the oil companies created a public nuisance, that they destroyed natural resources, and that they violated false-advertising and product-liability laws.
“Oil and gas company executives have known for decades that reliance on fossil fuels would cause these catastrophic results, but they suppressed that information from the public and policymakers by actively pushing out disinformation on the topic,” the complaint reads. “Their deception caused a delayed societal response to global warming. And their misconduct has resulted in tremendous costs to people, property, and natural resources, which continue to unfold each day.”
In a detailed 135-page complaint, the state makes the case that the companies and their trade group have known since the 1950s that emissions from their products would dangerously warm the planet. But rather than alert the public, seek to reduce their emissions or invest in cleaner technologies, they downplayed the dangers and promoted fossil fuels as safe.
The complaint claims that the companies’ greenwashing has continued up to the present day, with the oil companies promoting certain types of gasoline as environmentally friendly, and that the companies have recently walked back their commitments to reduce emissions.
The lawsuit also details the growing damage that climate change is inflicting on California in the form of record heat, drought and water shortages, wildfires, extreme storms, flooding, crop damage, coastal erosion and biodiversity loss.
“This last ten years, it’s shook me to my core,” Mr. Newsom said. “These are things that we imagined we might be experiencing in 2040 and 2050, but that have been brought into the present moment, and the time for accountability is now.”
Oil, gas and coal companies are facing a wave of climate lawsuits. Cities and states around the country have sued, and are seeking billions of dollars in damages.
The fossil fuel companies tried to get many of the cases moved from state court to federal court, where they believed they would face better chances of winning. But earlier this year, the Supreme Court declined to hear an appeal on the matter, meaning the cases will stay in state court, where experts believe municipalities have a better chance of winning damages.
Two recent lawsuits against big oil companies, one in Puerto Rico and one in Hoboken, N.J., have brought charges under the state and federal versions of the Racketeer Influenced and Corrupt Organization Act. But the California lawsuit does not bring claims under the state’s RICO act.
Instead, Mr. Bonta is seeking the creation of a fund that would be used to pay for recovery from extreme weather events and mitigation and adaptation efforts across the state. The lawsuit claims that California has already spent tens of billions of dollars paying for climate disasters, and expects costs to rise significantly in the years ahead.
“This has been a multi-decade, ongoing campaign to seek endless profits at the expense of our planet, our people, and the greedy corporations and individuals need to be held accountable,” Mr. Bonta said in an interview. “That’s where we come in.”
There is a precedent for such a fund. Several California cities sued the makers of lead paint on similar grounds. After decades of litigation, the companies agreed to settle for $305 million, which was used to create an abatement fund.