From Law360 by Frank Runyeon
November 7, 2019
The New York attorney general on Thursday abruptly dropped two fraud claims during closing arguments in a suit accusing Exxon Mobil of hiding the true cost of climate change from investors.
New York has claimed that Exxon Mobil Corp. defrauded investors when it inflated its value with an internal climate risk metric it hid from the public and has been trying to prove its case in a bench trial before Justice Barry Ostrager that began in New York State court more than two weeks ago.
Moments after government counsel began laying out its closing argument, Justice Ostrager interrupted to clarify that the attorney general was formally stipulating that two claims, one for common law fraud and another for equitable fraud, would be dismissed with prejudice in the final minutes of New York’s carefully-watched case against the oil giant.
After government counsel Jonathan Zweig opened by focusing exclusively on the Martin Act claims, the judge jumped in.
“Are you going to address these claims as well?” Justice Ostrager said of the other fraud claims.
“We are conceding that the common law fraud and the equitable fraud claims” are no longer in the case, Zweig told the court.
The judge summed up the last minute move, confirming that “we’re dealing with counts one and two,” which include a Martin Act claim and a persistent fraud claim, and stipulating that the remaining fraud counts, three and four, were out.
Exxon counsel Ted Wells of Paul Weiss Rifkind Wharton & Garrison LLP rose in indignation over the nixed claims.
Wells said Exxon did not come to trial “to have them stand up after the evidence has been presented…and say we are not pressing the two claims that have cost in many respects the most severe reputation harm to the company and to the executives.”
Full story here: https://www.law360.com/securities/articles/1218053