California looks to seize profits from Big Oil in climate change lawsuit

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California looks to seize profits from Big Oil in climate change lawsuit

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California will attempt to use consumer protection laws to seize some of the world’s biggest oil companies’ profits as part of a lawsuit accusing them of deceiving the public for decades over their role in climate change.

State attorney-general Rob Bonta invoked a new state law on Monday that allows claimants to target company profits that can be identified from the violation of consumer protection and advertising laws.

In an updated filing, it lists recent examples of alleged “false advertising and misleading environmental marketing by some of the defendants” and seeks profits they have generated to be deposited into a victims’ restitution fund.

The effort is part of a lawsuit that was launched by California against ExxonMobil, Chevron, Shell, BP and ConocoPhillips last September, and broadly accuses fossil fuel companies of spreading misinformation, sowing doubt about climate science, and claiming that some of their products are “clean”. 

The move comes as US states and cities increasingly turn to the courts to attack oil and gas companies using consumer protection, racketeering, product liability and other laws to obtain damages and cover climate-related costs.

Globally, the number of climate-related court cases has doubled in the five years between 2017 and summer 2023, according to research by the UN and Columbia University. The majority of the cases have been filed in the US.

The claim is also brought at a time when the fossil fuel industry has generated record profits as a result of surging energy prices following Russia’s invasion of Ukraine in 2022.

The top-10 listed US fossil fuel producers by value amassed a combined net income of $313bn in the first three years of the Biden administration, almost triple the amount in the same period under Trump. Oil and gas production in the US hit record levels in 2023.

California’s lawsuit alleges that oil and gas executives knew that relying on fossil fuels would have catastrophic results but suppressed the information. It claims the deception caused a delayed societal response to global warming, which has resulted in billions of dollars in damage including drought, sprawling wildfires and historic storms to California.

The state’s most recent filing adds new evidence of company lobbying, alongside the US’s industry group, the American Petroleum Institute (API), in making “false and misleading statements” in advertisements placed across a range of major US news outlets. 

The new allegations were filed in the superior court in San Francisco on Monday.

Ryan Meyers, API senior vice-president and general counsel, said climate policy was a matter for Congress to debate and decide, rather than a “patchwork of courts”.

“This ongoing, co-ordinated campaign to wage meritless, politicised lawsuits against a foundational American industry and its workers is nothing more than a distraction from important national conversations and an enormous waste of taxpayer resources,” he said.

Shell said the courtroom was not the right venue to address climate change. “Smart policy from government and action from all sectors is the appropriate way to reach solutions and drive progress,” said the company.

BP and ConocoPhillips said they would not comment on active litigation while the other corporate defendants named in the lawsuit did not immediately reply to a request for comment.

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