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NY Judge Hears Closings In $1B+ Exxon Climate Change Trial, State Drops Key Claims

Posted by David Siegel on Nov 8, 2019, 1:23:00 PM

Wells closing

CVN screenshot of Exxon attorney Ted Wells delivering his closing argument

New York City, NY - A New York State court judge heard closing arguments Thursday in a historic lawsuit accusing fossil fuel giant Exxon Mobil Corp. of withholding information from investors about the risks that climate change poses to the company’s bottom line.

The closely-watched trial, in a case filed by the New York State Attorney General’s Office, ended dramatically when Assistant AG Jonathan Zweig informed the court immediately after the conclusion of Exxon’s closing argument that the state intended to drop civil fraud claims, while leaving other portions of the case in place.

Lead attorney for Exxon, Ted Wells of Paul Weiss Rifkind Wharton & Garrison LLP, immediately protested. He told Justice Barry Ostrager, who is hearing the case without a jury, that the state’s decision amounted to a “cruel joke.”

“The reputations of a lot of good people have been disparaged by the bringing of this complaint,” Wells said, according to Courtroom View Network’s webcast of the closing arguments.

CVN webcast both the opening statements and closings in the trial, and video of the proceedings is available with a CVN Video Library subscription.

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Wells told Justice Ostrager that the state should not be permitted to “harass the company for three years” and then say “Oh, never mind” after making allegations at a public trial that drew worldwide media attention.

Wells asked Ostrager for a judicial finding noting that the plaintiffs had failed to prove the withdrawn claims, but Ostrager declined, noting the claims would be withdrawn “with prejudice” and that he could not make a ruling on a claim no longer before the court.

Wells responded that he had questions about whether or not existing case law permitted the state to withdraw their claims at this juncture, telling Ostrager that he needed to go to the library and “see what the books say about it.”

“I don’t think you’re going to the library,” Ostrager quipped to the high-profile attorney, prompting laughter from the packed courtroom gallery.

Ostrager will still decide the remaining claims brought under a state securities law called the Martin Act. The AG’s office says Exxon should pay up to $1.6 billion in damages for failing to disclose internal records showing climate change poses a far greater financial risk to the company than was publicly disclosed to investors.

“Exxon’s disclosures were misleading,” Zweig said during his closing argument, characterizing the state’s lawsuit as a “classic securities fraud case.”

“The question in this case is whether Exxon’s disclosures were accurate, and the evidence shows they were not,” he said.

Wells in his closing compared the state’s claims to the protagonist’s obsession in the classic novel “Moby Dick.”

“The theory of the case has not been supported by the evidence,” he said.

Watch gavel-to-gavel video coverage of Thursday’s closings, including argument over the withdrawn claims, along with the trial’s opening statements, and hundreds of other civil jury trials throughout the United States by becoming a CVN subscriber.

E-mail David Siegel at dsiegel@cvn.com

Topics: Securities, climate change, New York, Exxon