Big oil, big liability

Oil companies are currently battling a wave of litigation that seeks to hold them accountable for the effects of climate change and discrediting climate change science, with cases underway in New York, California, Rhode Island, Colorado, Maryland and Washington State.

The US climate litigants claim millions of dollars have been spent by oil companies to plant seeds of doubt about what causes climate change.

In a recent case brought against one of the world’s largest oil firms, ExxonMobil, and several other firms, lawyers for San Mateo County in California claimed that between 1998 and 2014, “ExxonMobil spent almost $31 million funding numerous organisations misrepresenting the scientific consensus that… fossil fuel products were causing climate change”.

In 1988, the Intergovernmental Panel on Climate Change (IPCC) was created by the United Nations to collate scientific evidence of climate change, its causes and its likely effects from hundreds of scientists, representing 25 different countries, in order to establish a broad global consensus regarding the science. In its first report, published in 1990, the IPCC concluded “beyond any doubt” that carbon dioxide, originating from human activities, is responsible for over half of global warming.

US climate litigants argue it was no longer reasonable, after 1990, for fossil fuel companies to remain sceptical about fossil fuels’ contribution to climate change given the IPCC’s broad consensus.

Further, a number of fossil fuel companies had recognised the link between their products and climate change before 1990. This is laid bare in subpoenaed internal documents in US courts.

In an internal report from 1968, American Petroleum Institute (API) concluded “although there are other possible sources for the additional CO2 now being observed in the atmosphere, none seems to fit the presently observed situation as well as the fossil fuel emanation theory” and “(t)here seems to be no doubt that the potential damage to our environment could be severe”. Most of the major fossil fuel companies operating in the US, including ExxonMobil, BP, Chevron, ConocoPhillips and Shell, were members of the API when it commissioned this report.

Nevertheless, since 1990, fossil fuel companies sought to mislead the public by stressing the uncertainty of the science underpinning climate change and highlighting doubts regarding the role of fossil fuels.

Creating doubt has been a key strategy for fossil fuel industry: It knowingly adapted its public communications strategy from the tobacco industry; industry groups and lobbyists had used similar strategies to promote scepticism with regards to evidence of the harm caused by smoking cigarettes in the 1960s and 1970s. A 1969 internal memo from R.J. Reynolds Tobacco Company describes the strategy: “(d)oubt is our product since it is the best means of competing with the ‘body of fact’ that exists in the mind of the general public.”

In 1991, the Information Council for the Environment (ICE), whose members include subsidiaries of Chevron and Occidental Petroleum, launched a climate change scepticism campaign involving full-page newspaper ads, radio commercials and flyers to mail to members of the public with the stated goal to “reposition global warming as theory (not fact).” Newspaper advertisements contained slogans, such as: “The most serious problem with catastrophic global warming is – it may not be true”; “Who told you the earth was warming… Chicken Little?”; and “Doomsday is cancelled. Again.”

ExxonMobil paid to publish advertorials in The New York Times every Thursday between 1972 and 2001, reaching an audience of millions of readers. One of Exxon Mobil’s 1997 advertorials states “(w)e still don’t know what role man-made greenhouse gases might play in warming the planet.” In the same year, another advertorial referred to a “high degree of uncertainty” regarding on-going “debate” and a “knowledge gap”. It stressed the need for further “fact-finding” before acting to mitigate greenhouse gas emissions. The advertorial advised that governments and other parties set a goal “of achieving a consensus view”, though this is what the IPCC, under the auspices of the United Nations, had delivered seven years prior.

Over the past three decades, a great acceleration in fossil fuel production and consumption has taken place, and more greenhouse gases emitted than during the entire period from the start of the industrial revolution, in 1750, up to 1988. Fossil fuel companies sought this outcome – the unregulated and unabated production and consumption of fossil fuels was their stated goal. An API memo illustrates this: “(c)limate is at the center of the industry’s business interests. Policies limiting carbon emissions reduce petroleum product use. That is why it is API’s highest priority issue”.

In June 2018, Judge William Alsup dismissed litigants’ case against BP and other fossil fuel companies in Oakland, California, reasoning that:

“our industrial revolution and the development of our modern world has literally been fuelled by oil and coal…. Having reaped the benefit of that historic progress, would it really be fair to … place blame for global warming on those who supplied what we demanded? Is it really fair, in light of those benefits, to say the sale of fossil fuels was unreasonable?”

This misses the mark. The relevant question is not whether fossil fuel consumption or sales were unreasonable but rather whether it was unreasonable for fossil fuel companies to promote climate change scepticism.

Tobacco companies fought off a wave of litigation in the 1980s and 1990s, before the US federal government won its case under the Racketeer Influenced Corrupt Organizations Act (RICO) against Philip Morris in 2000. This case argued that tobacco companies committed fraud and civil conspiracy by misleading the public as to the harms of smoking. This case unlocked substantial compensation to help cover the public healthcare costs associated with lung and respiratory disease.

Litigants have also sought to hold governments accountable for their failure to enact measures to fight climate change. In New Zealand, the High Court dismissed a 2017 case that sought the judicial review of the previous Government’s “inadequate” emissions reductions goals. However, courts have ruled in favour of climate litigants in other jurisdictions, such as the Netherlands where the Urgenda Foundation won a case against the Government forcing it to adopt more stringent emissions reductions targets.

No evidence of climate change scepticism funded by fossil fuel companies has come to light in New Zealand as yet, however coal mining firm Glencore was recently found to be funding a covert “anti-renewables” and “pro-coal” public relations campaign in Australia.

Fossil fuel companies are yet to be held accountable for misinforming the public about climate change science. If companies are eventually prosecuted then states and citizens that are the victims of wildfires, hurricanes, sea level rise and other costly disasters related to climate change, may receive compensation for losses and damages.

This would be welcome as costs of adaptation, and inevitable losses and damages, can be expected to swell before effective climate change mitigation gets underway. Or states themselves might be held accountable for their failure to regulate emissions and mitigate climate change.


This article first appeared on Noted, 1 May 2019, at: https://www.noted.co.nz/planet/climate-change-lawsuits-ramp-up-big-oil-big-liability/ 

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