Secretary of State Tillerson could be on hot seat in tense ExxonMobil climate risk probe
New York's Attorney General claims Exxon, under Tillerson, misled investors about the impact of climate change. The company has acknowledged that Tillerson, who has retained a private attorney, used an alias in internal emails discussing potential climate risks
Risk & Compliance
Technology / IIoT
Oil & Gas
Schneiderman’s office considers the nation’s chief diplomat a central figure in a case that pits the ambitious Democrat against a Texas energy giant and has divided attorneys general nationwide. Republican state prosecutors from South Carolina to Utah, like Exxon’s high-profile legal team, accuse the New York attorney general of abusing the power of his office to score political points with his liberal base on a politically explosive issue.
Schneiderman may have only just begun to use the power of his office, however, in an investigation that has already spanned roughly 18 months and forced Exxon to release roughly 3 million internal documents. It remains unclear whether he will ultimately force Tillerson to answer questions under oath, but he told The Associated Press he has the legal authority to question the secretary of state, who served as Exxon’s CEO until joining the Trump administration.
“We haven’t gotten to the point where that’s necessary, but yeah, we have the legal right to conduct depositions. I don’t know that we’re going to have to get to Mr. Tillerson, but sure,” Schneiderman told the AP when asked whether he has the right to question Tillerson.
The New York attorney general’s nonchalant tone does not reflect the intensity of the case or his office’s expectation that it will likely lead to Tillerson. The confrontation could be several months or even years away, however.
Schneiderman opened the Exxon investigation in November 2015, shortly after reaching a settlement with another fossil fuel giant, Peabody Coal. In that case, Schneiderman’s office determined that the coal company misled shareholders, regulators and the public about the company’s financial risks related to climate change.
Now, Schneiderman is using the subpoena power of his office to determine whether Exxon did the same.
After being forced to produce internal communications about the impact of climate change on its business, Exxon earlier this year acknowledged that Tillerson used the “Wayne Tracker” alias during email communications. The company says the alias was created to help the former CEO avoid a flood of messages after environmental activists obtained his actual email address.
Most of the “Tracker” emails have been deleted, Exxon says, citing the company’s practice of automatically deleting emails after a certain period of time. Exxon officials testified that the company allowed several months of Tillerson’s emails to be deleted even after Schneiderman’s office flagged them for preservation.
For now, Exxon says that many of the messages can be retrieved by collecting emails from those he communicated with.
Exxon’s legal team features Ted Wells, who previously represented tobacco giant Philip Morris and drugmakers Merck and Johnson & Johnson. Wells declined an on-the-record interview request, but he lashed out at Schneiderman in aggressive terms during a recent court hearing.
He cast the Democratic attorney general as an ambitious politician stuck in a lengthy and expensive fishing expedition. For Schneiderman to conclude his years-long investigation without bringing a formal lawsuit against Exxon, Wells said, would deeply disappoint the New York Democrat’s liberal supporters before his 2018 re-election.
The position is backed by Republican attorneys general in 12 states, who filed a friend-of-the-court brief late last month in a related federal case brought by Exxon to try to block Schneiderman’s investigation. The state prosecutors, led by Texas Attorney General Ken Paxton, argue that the attorneys general in New York—and Massachusetts, which is also probing Exxon—are abusing their power to prove a political point about climate change.
With the blessing of a New York Supreme Court judge, Schneiderman’s investigation is progressing.
The New York attorney general’s office will depose nine Exxon witnesses in the coming weeks in a series of lower-level depositions in a chain that is ultimately expected to lead to Tillerson. The State Department declined to comment on Tillerson’s involvement in the Exxon probe. The secretary of state has retained a private attorney to represent him in the matter.
The judge presiding over Schneiderman’s investigation, New York Supreme Court Justice Barry Ostrager, has so far allowed the attorney general to use his broad subpoena power to investigate Exxon. But he has been critical about both sides’ behaviour.
“If you’re asking me to state on the record that Exxon has behaved in an exemplary manner, I decline to do so,” Ostrager said in a recent hearing. “If Exxon is asking me to state on the record that the New York AG has proceeded in an exemplary manner, I decline to do that also.”
Associated Press writer Josh Lederman in Washington contributed to this report.