States: Let's Sue the Evil Evil Gas Companies! Gas Companies: How About We Sue You for Securities Fraud?
by meep
Let’s go with the first idiotic idea, the less idiotic idea, and then the amusing backlash.
Schwarzenegger to Sue Big Oil for ‘First Degree Murder’
AUSTIN, Texas — Arnold Schwarzenegger’s next mission: taking oil companies to court “for knowingly killing people all over the world.”
The former California governor and global environmental activist announced the move Sunday at a live recording of POLITICO’s Off Message podcast here at the SXSW festival, revealing that he’s in talks with several private law firms and preparing a public push around the effort.
“This is no different from the smoking issue. The tobacco industry knew for years and years and years and decades, that smoking would kill people, would harm people and create cancer, and were hiding that fact from the people and denied it. Then eventually they were taken to court and had to pay hundreds of millions of dollars because of that,” Schwarzenegger said. “The oil companies knew from 1959 on, they did their own study that there would be global warming happening because of fossil fuels, and on top of it that it would be risky for people’s lives, that it would kill.”
If it weren’t for oil, a lot of people in the northeast would be dead. How ‘bout them apples? We need the energy to heat our homes — cold kills in a way heat does not.
WHY DO YOU WANT ME TO DIEEEEE?!
Dumbass Californians.
THE ACTUAL LAWSUITS BY PENSION FUNDS
So here are stories of states that are suing gas companies.
Let’s start with the most recent story:
TABLES TURNED: Alarmists Now ‘Deny’ Climate Science While Big Oil Defends It
Something bizarre happened Wednesday after the U.S. District Court for the District Northern California held a “tutorial” hearing on global warming science.
Chevron agreed with the latest scientific assessment from the Intergovernmental Panel on Climate Change’s (IPCC), which was released in 2013 and 2014, the oil company’s lawyer said.
California cities, environmentalists and some scientists argued Chevron’s use of the IPCC’s latest assessment was misleading since it was outdated. Effectively, those seeking to punish oil companies are throwing aside the oft touted “consensus” on climate science.
….
Climate scientists Kate Marvel of NASA and Katharine Hayhoe of Texas Tech went on to argue the IPCC’s 2013 report was outdated and scientific studies in the years since have paint a more alarming picture of man-made warming.“The most recent IPCC report came out in 2013, but the climate model simulations used in that report stopped in 2005,” Marvel told Earther.
So, there’s a whole thing there, but here is one of the biggest parts of it.
Chevron specifically is signing on to a report made only 5 years ago. Others are saying it’s out-of-date. Okay, fair enough. Things move on, and if you have a data set that stopped in 2005, and now you have 12 more years of data – sure, stuff gets updated.
But the whole point is, if you want to bitch that the BIG BAD OIL COMPANIES are hiding IMPORTANT TRUTHS, bitching that they’ve not jumped on the most recent study that hasn’t really been tested out is not exactly the basis for a tort.
But I am not a lawyer.
That said, when you’re a BIG BAD OIL COMPANY, you do have lots of money, with which you pay for lawyers.
Let’s see what some of those lawyers are up to.
OIL COMPANIES: OH, GLOBAL WARMING IS SO BAD? WHY DO YOU DISMISS IT IN YOUR BOND ISSUES?
These communities sued Big Oil over climate change; then the backlash began
If you live in a city or county that sues oil companies over climate change, prepare for a blowback. ExxonMobil and other fossil fuel giants are taking legal action against such local governments, seeking to undermine a key part of their finances — their relationship with lenders.
Exxon’s target is several California cities and counties that have filed state lawsuits, claiming the oil and coal industries worked for decades to cover up their role in climate change and the consequences. The local governments want the industries to pay for damage and adaptation costs resulting from climate change, including sea-level rise and more extreme storms.
Exxon responded last month by petitioning a state court in Tarrant County, Texas — near the company’s headquarters in Irving — to subpoena California officials and lawyers involved with the lawsuits. In a novel legal tactic, Exxon alleges the local government officials are defrauding buyers of municipal bonds by not disclosing to lenders the climate risks they have claimed in their lawsuits.
This is not new news — I noted these countersuits back in January:
You see, many of these places bitching about the danger climate change is putting them in (oh, in 100 years or so… maybe…) discounted such dangers when they went to the market to go borrowing money.
…..
And it goes on like that. New York should take care — I know the state and New York City issue bonds all the time.Now, the New York politicians don’t need a civil conspiracy to dream up these SJW lawsuits, but some smaller cities in California may have needed the help:
So there are two parts to it — potential securities fraud, and a civil conspiracy to put together their lawsuits.
Going back to the recent Politico article:
It is hardly the first time Exxon has attempted to preempt climate change litigation and investigations that could expose it to court damages. After New York and Massachusetts attorneys general issued subpoenas to probe Exxon’s practices, the company sued both of them, claiming they were part of politically motivated conspiracy against the company.
“The reasons our investigations came to light was because Exxon actually sued us to shut down our investigations,” said Maura Healey, the Massachusetts attorney general, to a group of reporters in Washington last week.
Healey called the Exxon lawsuits an “unprecedented step” to “squash the prerogative of state attorneys general to do their jobs.” Since then, no other state has joined New York and Massachusetts in going after the oil giant.
….
But the oil companies are not letting this campaign gain momentum. Along with countersuing the jurisdictions that are suing, they’ve been getting help from a collection of industry-friendly think tanks and D.C. trade associations. These groups launched their own recent counter attack against the litigating local governments, which include San Francisco, Oakland, Richmond, Imperial Beach, Marin and San Mateo counties and Santa Cruz city and county.Groups that have received oil industry funding, such as the National Center for Public Policy Research and the Chamber of Commerce’ Institute for Legal Reform, have recently criticized the coastal communities in Fox News and The Sacramento Bee op-eds. In January, the National Association of Manufacturers hired a former Bush administration lawyer to counter litigation filed against oil refiners and other companies.
Here is the bottom-line — for these states & localities to sue Exxon et. al. for damages, they have to estimate the damages. They are projecting costs. They are saying these costs are going to be substantial.
But in 30-year bond offerings, they’re saying “oh… we don’t know.”
Let me tell you how credible that is as an argument.
Okay, I am not going to address whether climate change is human-driven in any appreciable way, and in which way that climate change is occurring. I will grant them true-believer status… but not actually knowing the timing and magnitude of that climate change. They really don’t know.
But it’s not the strongest basis for a lawsuit. Because it becomes pretty obvious that there are a couple motivations: getting as much money as they can for the pensions… or politicians getting as much political publicity as they can to try for higher office. (Or a lobbying position, which can be more lucrative.)
So that’s the climate change stuff… I’ll get back to that in a bit.
Let’s jump back to the gun divestment movement!
WHY DO YOU HATE THE ENVIRONMENT?
You think hunters are evil? The gun folks are destroying nature!
But then there’s reality…
Outdoor Life: Think Before You Boycott: Guns, Public Land, and Vista Outdoor
National Review: To Be Successful, Environmentalists Must Embrace Gun Culture
NPR: Decline In Hunters Threatens How U.S. Pays For Conservation
I remember when I learned that the conservation movement in the U.S. was driven far more from people like Teddy Roosevelt — ardent hunters — than St. Francis-like animal-lovers. It was a bit surprising to me initially, but I wasn’t a child at that point… the whole point was that one wanted to make sure that there would be animals around to hunt. This is a long and well-known strategy in wildlife management.
I’m sorry to hear that public pensions are so intent on killing all the wildlife.
WHY DO YOU WANT TO KILL THE WILDLIFE, PENSIONS?!
Okay, that’s enough of that.
OTHER DIVESTMENT STORIES
Let’s gather them up!
- CalPERS Report Details Role in Dakota Pipeline Controversy
- CalPERS investment committee rejects an April vote on gun divestment
- California pension fund urged to divest from gun sellers
- Massachusetts Bill Calls for Firearms Divestment
- New York State Fund Snubs All-Male Boards
- New Massachusetts Bill Would Pull Pension Money From Gun Companies
- A pension ploy that solves little
- Divesting is the right choice — financlly and ethically
- Washington state’s public pensions include $5.3M in gun-related investments
- Connecticut Considers Gun Divestment
- Kennedy calls for legislator pension fund to divest from guns, jabs Biss
- Tobacco, Weapons Exclusions Reduce Norway Fund’s Returns
- Kennedy wants Illinois to pull pension investments from gun companies
- California’s Pension Woes Exacerbated by Politics
- Governor Cuomo And Comptroller DiNapoli Appoint First-Ever Decarbonization Advisory Panel
- Point of View: Comparing fossil fuel companies to Big Tobacco: a lose-lose strategy
- CalPERS won’t pull its money out of gun sellers. Here’s what it’s doing instead.
Ugh.
Well, it’s a good idea to watch, even if they’re doing insane things.
GOOD ACTIVISM VS BULLSHIT ACTIVISM
What I mean here is shareholder activism. Public pension funds have a lot of money, and some of them, Calpers and New York funds, throw that weight around.
I have two stories with respect to this, one of which I believe is legit behavior and one which I think is bullshit. Guess which is which.
Tesla shareholders approve $2.6 billion CEO stock option despite pension fund opposition
A $2.6 billion stock option grant for Tesla Inc. CEO Elon Musk was supported by a majority of shareholders at a special shareholder meeting on Wednesday, despite objections from several large pension funds.
….
The $355.4 billion California Public Employees’ Retirement System, Sacramento; $224.4 billion California State Teachers’ Retirement System, West Sacramento; and the C$337 billion ($257.2 billion) Canada Pension Plan Investment Board, Toronto, were among the shareholders that voted against the new compensation plan.Anne Sheehan, director of corporate governance at CalSTRS, said in an emailed statement on the vote: “Given the size of the award, we believe the potential dilution to shareholders is just too great. In addition, we have concerns about the lack of focus on profitability for the company, and the one profitability metric that is used excludes the cost of stock-based compensation.”
NY state pension fund pushes for corporate board diversity
ALBANY, N.Y. (AP) — The New York official in charge of the state’s $209 billion public pension fund says it will take steps to ensure women are included on the boards of companies in the fund’s portfolio.
State Comptroller Thomas DiNapoli (dee-NAP’-oh-lee) announced Wednesday that the New York State Common Retirement fund is “putting all-male boardrooms on notice” to diversify.
The Democrat says the fund will use its power as a shareholder to vote against board directors up for re-election at companies with no women on their boards.
DiNapoli also said Bristol-Meyers Squibb, Leucadia National, Packaging Corp. of America and PulteGroup have agreed to include gender and racial diversity when considering board candidates.
The New York fund is the nation’s third largest public pension fund. DiNapoli is the fund’s sole trustee.
I’ll give you a moment to think about this.
Okay, here’s the deal.
Complaining that shareholder value is diluted because an over-the-top stock awarding to an executive — that’s legit. Yay.
Bitching that there aren’t enough women on the board? COME ON.
Sorry, there’s no “woman magic” where one can just drop any woman on a board of directors and company governance improves.
Yes, it’s nice to make sure that you don’t have too many insiders on the board, and that qualified people are chosen for the board….but I’m not seeing the specific value in digging up women for the board.
EYES ON THE PRIZE
The problem, of course, is that the people making these decisions have no skin in the game.
While fiduciary duty is supposed to align these people’s interest with the pensioners’ interest… many of these decision-makers have their own political (or monetary) goals, and if they screw up investment decisions for the pensions… well, that’s not their problem. They’re not going to have that money taken out of their hides.
But even if one thinks that pension fund value would be enhanced via this behavior, one needs to think this through a bit.
What happens if it doesn’t work out?
The decisionmakers are assuming that the taxpayers (or maybe bond buyers) will step up to fill the hole that they created.
Well.
Let me know how that turns out.
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