City of New York v. Exxon Mobil Corp.

A New York Supreme Court dismissed New York City’s claims that fossil fuel companies violated the City’s Consumer Protection Law by misleading consumers about the climate change risks of their products and their commitments to renewable and alternative energy sources. Applying “an objective reasonable-consumer standard,” the court concluded the City failed to plausibly allege that the defendants’ statements regarding the environmental benefits of specific products were likely to mislead. The court was not persuaded by New York City’s theory that the companies’ statements were deceptive because they failed to disclose their products’ substantial greenhouse gas emissions. The court found that because the City also conceded that “the connection between fossil fuels and climate change is public information,” a reasonable consumer could not have been misled. The court also cited additional independent reasons for dismissal of these product greenwashing claims: (1) that the alleged greenwashing statements were taken out of context and (2) that they constituted “statements of aspiration, opinion, or puffery.” Regarding the City’s claim of “corporate greenwashing,” the court found that the companies’ statements regarding their investments in clean and alternative energy sources were not actionable under the Consumer Protection Law because they were not alleged to be “made in connection with the sale” of a consumer good. The court also held that allegations of violations based on statements made more than three years before City filed its complaint (i.e., statements made before April 22, 2018) were time-barred under New York law and pursuant to a July 2024 stipulation by the parties. The court rejected the companies’ arguments that they were not subject to the court’s jurisdiction, finding that the companies’ contacts with and activities in New York City were “purposeful” and “substantially related to the underlying claims of deceptive practices in NYC.” The court also declined to dismiss the City’s claims under New York State’s anti-SLAPP (Strategic Litigation Against Public Participation) law, citing its earlier decision denying American Petroleum Institute’s anti-SLAPP motion to dismiss. The court did not address the defendants’ First Amendment arguments.

A New York trial court dismissed New York City’s claim that American Petroleum Institute (API) engaged in deceptive trade practices in violation of New York City’s Consumer Protection Law. First, the court found that personal jurisdiction was not established because API did not acquiesce to general jurisdiction by registering to do business in New York and because the City did not allege that API’s alleged false and misleading greenwashing statements were targeted at New York State. Second, the court found that New York City did not sufficiently plead that API’s statements were “in connection with the sale or purchase of fossil fuel products” as required for liability under the Consumer Protection Law. The court rejected, however, API’s argument that New York’s anti-SLAPP (Strategic Lawsuit Against Public Participation) law barred the City’s claim. The court said it was “hard-pressed to find that the New York State Legislature intended for the anti-SLAPP law to apply to New York governmental agencies that are empowered to work on behalf of the citizens of New York.” The court also was persuaded that there was a presumption in New York law against allowing general statutory language to bind the State and its political subdivisions.

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