Scientific Freedom Invoked in Subpoena Battles over Corporate Climate Knowledge

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Publication date: 
29 July 2016

State attorneys are using their subpoena power against ExxonMobil to investigate whether the company committed fraud by publicly contradicting its inside knowledge of risks that climate change poses to its business. Meanwhile, Rep. Lamar Smith is attempting to use his subpoena power as chairman of the House Science Committee to intervene in those investigations, claiming as legal justification a committee responsibility to defend scientific freedom. With a showdown looming in that battle, Senate Democrats are using the bully pulpit to condemn organizations that they allege conspire to undermine the mainstream scientific consensus on climate change.

State authorities pursuing coordinated legal action

On Nov. 5, 2015, the New York State Office of the Attorney General (NYOAG) announced a fraud investigation against the energy company ExxonMobil. The investigation seeks to demonstrate that a divergence between the company’s inside knowledge about climate change and its public profession of doubt on the subject rises to the level of illegality. ExxonMobil now accepts anthropogenic climate change, but denies any wrongdoing. (Days following the announcement, NYOAG announced a settlement with Peabody Energy, the world’s largest coal company, following a similar investigation.)

ExxonMobil’s inside knowledge of climate change came to public attention in the two months preceding NYOAG’s announcement, when InsideClimate News and the Los Angeles Times published reports based on interviews and publicly available documents. These reports drew stark contrasts between the climate research that the company publicly conducted in the 1970s and 1980s and its later statements and support of organizations dedicated to criticizing mainstream climate research.

New York Attorney General Eric Schneiderman speaks at a press conference announcing the formation of a coalition of state-level attorneys general joining or backing his fraud investigation of ExxonMobil. Former Vice President and climate policy advocate Al Gore stands next to him.New York Attorney General Eric Schneiderman speaks at a press conference announcing the formation of a coalition of state-level prosecutorial authorities joining or backing his fraud investigation of ExxonMobil. Climate policy advocate and former Vice President Al Gore stands next to him.

As part of its investigation, NYOAG has issued a subpoena to ExxonMobil to obtain further documentation, using the unusually expansive powers that New York’s Martin Act grants the office to investigate securities and business fraud. California initiated its own investigation in January 2016, and in March 2016 Massachusetts and the Virgin Islands announced additional investigations, backed by a number of other states and the District of Columbia.

According to reporting by InsideClimate News, ExxonMobil has at least partially cooperated with NYOAG’s investigation, turning over thousands of documents. However, ExxonMobil filed suit against the Virgin Islands and Massachusetts to overturn their subpoenas, and in late June the Virgin Islands agreed to drop its subpoena.

Rep. Smith investigates state investigations, invokes scientific freedom

On May 18, Rep. Lamar Smith (R-TX), chairman of the House Science Committee, launched his own investigation, alleging that the state investigations constituted “a coordinated attempt to deprive companies, nonprofit organizations, and scientists of their First Amendment rights and ability to fund and conduct scientific research free from intimidation and threats of prosecution.” In letters signed by 12 other Republican Science Committee members and sent to the offices pursuing and backing the investigations and to eight advocacy organizations, Smith requested that the recipients provide to the committee privileged documentation detailing their deliberations and interactions.

On May 26, NYOAG refused Smith’s request, remarking that a congressional attempt to investigate a state law enforcement action represented a violation of state sovereignty. The office also denied the Science Committee’s jurisdictional authority concerning fraud enforcement cases. Massachusetts issued its own response on June 2.

In a June 17 letter, Smith expanded on the case for his committee’s authority, arguing that legal precedent showed it had the right to investigate any subject that had the “‘potential’ for a legislative solution.” Smith’s letter also offered a case for the investigation’s particular appropriateness to the Science Committee’s defined jurisdiction:

Ultimately, the science relied upon by the federal government must be sound, reproducible, and transparent—in other words, beyond reproach and unimpeachable. In the area of climate change, we simply are not at the unimpeachable level. Therefore, it is the position of the Science Committee that offices such as yours and those similarly situated should not be taking legal actions based on debatable science to undermine the First Amendment of the Constitution.

The letter elaborated that the states’ investigation aimed to

decide what science is valid and what science is invalid. In essence, you are saying that if your office disagrees with whether fossil fuel companies’ scientists were conducting and using the ‘best science,’ the corporation could be held liable for fraud. Not only does the possibility exist that such action could have a chilling effect on scientists performing federally funded research, but it also could infringe on the civil rights of scientists who become targets of these inquiries. Your actions violate the scientists’ First Amendment rights. Congress has a duty to investigate your efforts to criminalize scientific dissent.

In its June 24 reply, NYOAG rejected that argument, calling it “a fundamental misapprehension of the NYOAG’s on-going investigation,” and reasserted that its investigation related solely to securities, business, and consumer fraud, having no bearing on scientific work.

Battle between Smith and the states escalating rapidly

On June 23, Rep. Eddie Bernice Johnson (D-TX), ranking member of the House Science Committee, wrote an excoriating, ten-page letter to Smith, arguing that his interference with state law enforcement had brought the committee “to the precipice of a Constitutional crisis.” Her letter concurred with the attorneys general that their investigations passed no judgment on the quality of scientific work, and revolved entirely around “whether certain fossil fuel companies believed or knew one set of facts, and yet publically disseminated another in order to enrich themselves at others expense.” She pointed to the precedent of successful state investigations of tobacco companies in the 1990s.

In any event, she argued, Rule X of the House Rules, clearly limits the committee’s authority to the scientific activities of the federal government. She also suggested that there was an “unintentional irony” in Smith’s claims to be guarding against a “chilling” effect, given his own recent, broad subpoena of documentation relating to a scientific paper that National Oceanic and Atmospheric Administration researchers published last year (see FYI 2015 #141 and 2016 #58).

Rep. Lamar Smith, accompanied by other Republican members of the House Science Committee, announces subpoenas relating to state fraud investigations against ExxonMobil.

On July 6, Smith issued new letters to the New York and Massachusetts attorneys general and to the advocacy organizations encompassed in his investigation, threatening subpoena. The next day, Johnson insisted that Smith convene the full committee to discuss the issue. Undeterred, Smith issued his subpoenas on July 13.  

On July 26, the two state offices submitted letters formally refusing compliance and detailing their legal arguments for doing so. NYOAG remarked that, while Smith was entitled to issue a subpoena unilaterally, resolving objections to subpoenas required participation of the full committee. Moreover, the office asserted that, given the “unprecedented” nature of the subpoena to state authorities, “resolution of these objections by less than the whole Committee would show a profound disrespect for the important constitutional interests at stake.” In response, Smith vowed to “use all tools” at his committee’s disposal to continue the investigation.

Senate “Web of Denial” actions complement state investigations

Sen. Sheldon Whitehouse (D-RI) organized a series of Senate floor speeches concerning what the speakers called a Web of Denial, a set of organizations that conspire to undermine the mainstream scientific consensus on climate change. Here he is discussing the article series on ExxonMobil that InsideClimate News published last year.

While the drama over Smith’s subpoenas unfolded, from July 11 to July 13, 19 Democratic senators, including Tim Kaine (D-VA), now the Democratic vice presidential nominee, delivered speeches on the Senate floor spotlighting what they called a “web of denial”—a set of companies and organizations, including ExxonMobil, that the senators allege have conspired to systematically sow illegitimate doubt concerning the scientific consensus on climate change. These speeches supported a resolution condemning such activity.

On July 12, a coalition including organizations targeted by the senators issued a letter to them, condemning their use of “their official offices to marginalize political foes.” Nine of the senators responded on July 22, writing,

Freedom of speech does not prevent us from speaking out when your organizations, as well-funded agents of hidden principals with massive conflict of interest, subject our constituents to an organized campaign to deceive and mislead them about the scientific consensus surrounding climate change.

Whether any prosecutorial authorities will extend current legal action to additional public companies, or even beyond, remains to be seen.

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