Few citizens would include “climate change” among New York State’s top law-enforcement priorities. Few, that is, except the one citizen who happens to be New York’s attorney general: Eric Schneiderman. On November 4, Schneiderman launched an investigation of ExxonMobil for allegedly misrepresenting the risks of climate change. The first strike: a subpoena demanding Exxon hand over all of its documents relating to climate research from 1977 to the present, including any communications regarding such research with outside groups.
The use of government prosecutorial power to silence those who deviate from climate-change orthodoxy is an emerging goal of the green lobby. In recent months, more than 40 environmental groups as well as all the Democratic presidential candidates have called on U.S. attorney general Loretta Lynch to conduct a federal probe of Exxon—though the politicians and pressure groups cannot specify any crimes that the firm committed. Lynch hasn’t responded to this pressure; thus, it has fallen to Schneiderman to satiate the progressive bloodlust against energy companies. Already the New York AG has forced another company, Peabody Energy, to settle charges that it concealed the risks of climate change.
Ostensibly, the Exxon investigation focuses on whether the company disclosed to investors the financial risks arising from global warming; in particular, the risk that government regulation could require Exxon—and other oil companies—to leave reserves in the ground. But Exxon’s most recent annual report prominently highlights the risk of government regulation, warning that various measures under consideration “could make our products more expensive, lengthen project implementation times, and reduce demand for hydrocarbons, as well as shift hydrocarbon demand toward relatively lower-carbon sources such as natural gas. Current and pending greenhouse gas regulations may also increase our compliance costs, such as for monitoring or sequestering emissions.”
Disclosure in itself, therefore, does not appear to be the problem. Nor is there any serious doubt that Exxon conducted rigorous research about climate change. The company maintains a list of more than 50 peer-reviewed articles on the topic published by Exxon scientists from 1983 to the present. Instead, what has inflamed progressives, and given impetus to the New York investigation, is the revelation that Exxon has given money to conservative organizations that oppose the extreme policy proposals of climate alarmists. Or, to use the New York Times’s tendentious description, the company may have played a role in “directing campaigns of climate denial, usually by libertarian-leaning political groups.” (The Manhattan Institute, which publishes City Journal, is one of the groups that have received funding from ExxonMobil, but the funding was not earmarked for research on climate issues.) Indeed, the Times notes that Exxon supposedly funded work by a Smithsonian researcher who had published papers “questioning established climate science.”
It is, of course, heresy among the progressive elite to “question established climate science,” but is it a crime? As Daniel Fisher delicately puts it in Forbes, “It’s an interesting question whether a company can break the law by financing research that it hopes will influence the public debate on a subject that affects its business.” The answer to that question should be “no,” but in New York, prosecutors have at their disposal the Martin Act, a 1921 law that criminalizes not only fraud, but a wide array of ill-defined conduct including deception, misrepresentation, concealment, suppression, and false pretense. A 2004 analysis of the Martin Act in Legal Affairs explains that “to win a case, the AG doesn’t have to prove that the defendant intended to defraud anyone, that a transaction took place, or that anyone actually was defrauded.”
First Amendment alarm bells ought to be ringing if prosecutors can use a blunt instrument like the Martin Act to stop companies from funding advocacy on questions of public policy. The extent and causes of climate change, and the right response to such change, are all topics that are subject to vigorous debate. Imagine a prosecutor targeting wind and solar companies for funding research that might exaggerate the threats of climate change. The green lobby would howl in protest over such censorship. And rightly so: the lesson of the Supreme Court’s 2010 decision in Citizens United v. Federal Election Commission is that Americans don’t lose their First Amendment rights when they act through a corporation.
Defenders of Schneiderman’s investigation point to the precedent set by the tobacco lawsuits of the 1990s. After all, the argument goes, state attorneys general successfully prosecuted tobacco companies for lying about a matter of public health—why not bring similar cases against oil companies? But on closer examination, the analogy with tobacco lawsuits breaks down. The tobacco companies were charged with selling a deadly product while lying to consumers about the risks of using the product. In the case of oil companies, there is no evidence that consumers misunderstood the health risks of petroleum (it’s highly flammable). Rather, the theory behind the Exxon probe appears to be that the company somehow misled investors by actively opposing certain carbon restrictions rather than gleefully touting the inevitability of such regulations.
The theory is tenuous, but the endgame is clear: to force Exxon and other companies to settle. Even when the underlying legal theory is frivolous, responding to a subpoena like the one served on Exxon—which seeks nearly 30 years of records—presents high financial and reputational costs. Moreover, the risk of criminal prosecution is one that most companies, particularly publicly-traded companies, can’t afford to take. Peabody Energy has already buckled under the threat of prosecution. After a few more energy companies embrace climate alarmism to avoid the taint of prosecution, the rest of the industry will be sufficiently intimidated to pull any funding from groups that question “established climate science.”
Progressives like to claim that there is an overwhelming consensus in favor of radical action on climate change. That may not currently be true, but it certainly will be once climate dissent is outlawed.