Thu, Jul 18 2024 18 July, 2024

California wants to seize oil majors’ profits as climate damages

California amended a lawsuit it filed against five western oil majors last year, hoping to seize “ill-gotten” gains from climate deception and cover-up.

An oil refinery in Bakersfield, California Photo: Adobe Stock/Matt Gush)

California is hoping to seize some of the profits from a handful of oil majors as damages for decades of pollution and the long history of covering up their knowledge of climate change.

On June 10th, California Attorney General Rob Bonta amended a lawsuit that the state filed last year against five western oil majors — ExxonMobil, Shell, Chevron, ConocoPhillips, and BP — along with the industry’s main lobby group, the American Petroleum Institute. That case argued that the industry engaged in a “decades-long campaign of deception” that led to climate change-related harms to California.

Well-documented research has demonstrated that the oil industry has known about climate change since the middle of the 20th Century, but instead of informing the public, they covered up their knowledge and funded climate denial through a network of think tanks and PR firms. That research and reporting helped launch a wave of litigation against the oil industry, with dozens of cases that are slowly moving forward in the U.S. judicial system.

But now the attorney general of California wants to seize profits from those companies using Unfair Competition Law and False Advertising Laws. If successful, the proceeds obtained from the lawsuit would be used to compensate victims of the alleged consumer fraud.

The attorney general also submitted new evidence that the oil majors continue their pattern of deception up to the present, with ongoing false advertising about their roles in addressing climate change.

“This much is clear: Big Oil continues to mislead us with their lies and mistruths, and we won’t stand for that,” Attorney General Bonta said in a statement. “Their ongoing egregious misconduct is damning. We will continue to vigorously prosecute this matter and ensure that Big Oil pays to abate the harm they have caused, and we will recover ill-gotten gains that will benefit Californians.”

Meanwhile, legislation in state capitols is starting to proliferate that would also claw profits back from the oil industry. Just a few weeks ago, the state of Vermont passed the Climate Superfund Act, which requires the State Treasurer to calculate the costs of climate damages caused by large fossil fuel companies between 1994 and 2024. From there, the state would demand cost recovery from those entities, with the proceeds used for climate adaptation and resilience.

And in New York, in the waning hours of the state’s legislative session, the New York Assembly passed its version of a Climate Superfund Law. The law would charge the oil industry $3 billion per year to pay for the costs of climate change.

According to the Wall Street Journal, citing estimates from the state senate, Saudi Aramco could owe New York roughly $644 million per year, for example. The bill still needs to be signed by the New York Governor.

Both pieces of legislation in Vermont and New York will be subjected to litigation from the oil industry, which could take years to work its way through the courts.

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