On Tuesday, a New York (NY) judge cleared energy giant ExxonMobil of alleged securities fraud involving climate change regulations risk in a closely watched case that fatally weakened over the years.
Manhattan Supreme Court Justice Barry Ostrager ruled the state failed to prove “by a preponderance of the evidence” that the firm “made any material misstatements or omissions about its practices and procedures that misled any reasonable investor,” in violation of the Martin Act, an expansive law that does not require proof of intent of shareholder fraud.
He agreed that ExxonMobil’s “proxy cost” of up to US$80 per tonne of carbon dioxide emissions projected by 2040, and internal greenhouse gas estimates of half or less that amount, were distinct and “different metrics.” The lawsuit by the office of State Attorney General Letitia James unsuccessfully argued that ExxonMobil (XOM) caused investors to lose up to US$1.6 billion by falsely claiming it had properly evaluated the impact of future climate regulations on business.
