I was one of 46 state attorneys general who signed the tobacco Master Settlement Agreement in November 1998. On behalf of New York’s taxpayers, I filed one of the suits that eventually pushed the cigarette makers to settle. I can tell you from experience that our fight against the tobacco industry has almost nothing in common with today’s campaign by several state attorneys general against ExxonMobil — despite what supporters of the effort would like you to believe.
In the case of tobacco, we made a powerful argument that decades of lying by the companies had led to intractable addiction of millions of Americans who suffered devastating illnesses and death, all of which cost the states billions every year in Medicaid expenses. In the current action, a group of Democratic attorneys general, acting as part of a campaign launched by well-heeled special interest groups and financial backers of alternative energy companies, have a different goal: using the power of state attorneys general to curb honest debate. (Disclosure: My law firm is representing two New York state municipalities that are challenging the siting of wind turbine projects on the shore of Lake Ontario.)
The tobacco campaign was highly successful. The settlement agreement included not only direct payments to the states (currently $9 billion a year) but also imposed severe marketing restrictions to limit outreach to young smokers. Largely as a result, the proportion of high school student smokers dropped from 36 percent in 1997 to just 16 percent in 2013; adult smokers, from 25 to 17 percent. I was proud to play a major role in holding tobacco companies responsible for the damage they caused and in setting America on a healthier path. We had a clear, convincing legal case and a noble cause. The same cannot be said for attorneys general involved in the current crusade.
It’s unlikely they will be successful in their legal actions, and their actions may have already chilled free speech in this country.
ExxonMobil was subpoenaed last fall by New York Attorney General Eric Schneiderman (D) in an effort to find out whether the company misled investors and the public on the impact of climate change. Massachusetts joined in. Then, in March, the Virgin Islands, a U.S. territory, started investigating ExxonMobil, as well as think tanks and other institutions that received the company’s support, under an anti-racketeering law. Later that month, 16 state attorneys general, all Democrats, held a news conference under the banner, “AGs United for Clean Power,” to announce they too will pursue energy companies that challenge the global-warming orthodoxy.
But increasingly, Schneiderman appears to be on his own. Last week, Claude Walker, the attorney general for the Virgin Islands who opened a racketeering probe of ExxonMobil, withdrew his subpoena. And Maura Healey, attorney general for Massachusetts, delayed action on her own subpoena of ExxonMobil, meaning that case has paused.
It is important to note that the fight against the tobacco industry was bipartisan and that never, during our battle to require the tobacco companies to meet their obligations, did we align ourselves with the industry’s business competitors. In the current campaign, the attorneys general have linked up with investors in renewable energy in an unseemly alliance that presents serious conflicts of interest. As a June 15 letter signed by 13 AGs critical of their colleagues noted, “The media event [in March] featured a senior partner of a venture capital firm that invests in renewable energy companies. If the [AGs’] focus is fraud, such alignment by law enforcement sends the dangerous signal that companies in certain segments of the energy market need not worry about their misrepresentations.”
Attorney General Schneiderman’s theory is apparently that ExxonMobil pulled the wool over America’s eyes by manipulating public opinion. “There is confusion,” he said, “sowed by those with an interest in profiting from the confusion and creating misperceptions in the eyes of the American public.” One could argue that the same confusion and misperception has been caused by alternative energy proponents. Causing confusion — if that’s what happened — is hardly a crime, but to hold one party to a national debate to a higher standard tilts the debate unfairly in the other direction.
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Notably, the attorney general is pursuing his investigation under the Martin Act, a sweeping New York law that I know well. It gives the attorney general broad subpoena power, and it allows charges to be filed even without evidence that the defendant intended to commit fraud. It is a powerful tool to protect investors but can have unintended negative implications to the very investors it seeks to protect.
In the case of tobacco, we found that the companies knew about the life-threatening, addictive nature of smoking but covered up that knowledge. In the case of global warming, ExxonMobil began research as early as the 1970s and was open about what it found in more than 50 papers published in scientific journals between 1983 and 2014, according to company documents. ExxonMobil’s scientists have participated in the U.N. Intergovernmental Panel on Climate Change since its inception and were involved in the National Academy of Sciences review of the third U.S. National Climate Assessment Report.
In its news pages, even the New York Times, a forceful environmental advocate, has drawn a clear line between the tobacco and energy industries. Reporters Justin Gillis and Clifford Krauss wrote in a Nov. 5 article, “In the 1950s and ’60s, tobacco companies financed internal research showing tobacco to be harmful and addictive, but mounted a public campaign that said otherwise. . . . The history at ExxonMobil appears to differ, in that the company published extensive research over decades that largely lined up with mainstream climatology.”
The tobacco companies were deceivers. ExxonMobil has been open. But that doesn’t seem to matter to the politicized attorneys general pursuing the company. A chilling impact on public debate is not in our collective interest.