In two decisions, a Massachusetts Superior Court denied Exxon Mobil Corporation’s (Exxon’s) motions to dismiss an action brought by the Massachusetts Attorney General asserting that Exxon systematically and intentionally misled investors and consumers about climate change. In the first decision, the court declined to dismiss the action on personal jurisdiction grounds or for failure to state a claim. With respect to personal jurisdiction, the court found that the Commonwealth sufficiently alleged that its investor deception claim arose from Exxon’s contacts with Massachusetts. Regarding the consumer deception claims, the court found that the claims arose from Exxon’s advertisements through its Massachusetts franchisees, and that the court therefore could assert personal jurisdiction over Exxon based on the Supreme Judicial Court’s <a href="https://climatecasechart.com/wp-content/uploads/case-documents/2018/20180413_docket-SJC-12376_opinion.pdf">previous determination</a> that Exxon’s franchise network of retail service stations satisfied the “transacting any business” prong of the Massachusetts personal jurisdiction statute. The court also found that the exercise of jurisdiction over Exxon satisfied the Massachusetts long-arm statute and due process requirements. In rejecting Exxon’s arguments that Massachusetts failed to state a claim, the court found that Massachusetts’s allegations regarding statements to investors that climate change risks did not pose a meaningful threat were sufficient to survive a motion to dismiss. The court rejected Exxon’s characterization of the allegations as based on failures to disclose information readily available to the public. The court also found that the allegations plausibly alleged that Exxon deliberatively misrepresented and omitted information about the risks of climate change and that Exxon was engaged in trade or commerce when it made the allegedly deceptive statements. The court also found that the Commonwealth’s deceptive advertising claims did not have to be based on allegations that Exxon’s representations about particular fuel products were false, only that the representations were misleading. In addition, the court found that it could not conclude at this stage of the litigation that Exxon’s representations would not mislead a “reasonable consumer”; the court also was not persuaded by Exxon’s argument that the claims involved a “pure omission” not subject to liability. Regarding the Commonwealth’s “greenwashing” claims, the court concluded that it would not be appropriate to determine at the motion to dismiss stage whether the alleged misrepresentations were “inactionable puffery.” The court also declined to rule at this stage on whether any of the allegedly misleading statements to investors and customers constituted speech protected by the First Amendment.

Action by Massachusetts attorney general asserting that Exxon Mobil Corporation committed deceptive practices against Massachusetts investors and consumers, including by failing to disclose climate change risks.

Commonwealth v. Exxon Mobil Corp.

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Massachusetts Court Declined to Dismiss Massachusetts Investor and Consumer Protection Action Against Exxon

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United States of America

Massachusetts

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Massachusetts Court Declined to Dismiss Massachusetts Investor and Consumer Protection Action Against Exxon

Policy instrument

Risk

Impacted group

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Adaptation/resilience

Finance