Federal Climate Investigation of Exxon Likely to Fizzle Under Trump

Sen. Jeff Sessions, Donald Trump's choice as attorney general, has been a vocal opponent of investigating the oil giant for climate fraud.

Sen. Jeff Sessions, Donald Trump's pick for attorney general, has called for an end to investigations of Exxon

Sen. Jeff Sessions, Donald Trump's pick for attorney general, has called for an end to climate investigations of Exxon. Credit: Getty Images

Over the past year, the battle lines formed along partisan lines on the question of whether the Justice Department should launch a probe into ExxonMobil's stance on climate change.

The designated referee in that battle was to have been U.S. Attorney General Loretta Lynch, who received the formal letters staking out each side's position on an investigation.

One of those letters, sent by five Republican senators sympathetic to Exxon, carried the signature of Alabama Sen. Jeff Sessions, who is Donald Trump's choice to succeed Lynch as the next attorney general.

That letter argued that a federal investigation of Exxon would suppress debate on the validity of climate change and amounted to prosecutorial misconduct. Any investigation of the oil giant must be stopped immediately and no future probes initiated, Sessions and the other senators told Lynch.

If he is confirmed by the Senate to replace Lynch, Sessions will become the nation's top law enforcement officer and would hold ultimate authority on the future of any federal investigations of Exxon, making it highly unlikely that any investigation underway would proceed any further. Sessions did not respond to an interview request.

Sessions would have a seat at Trump's cabinet table alongside like-minded climate denialists tapped to run the Environmental Protection Agency as well as the Departments of Commerce, Interior and Energy. And even if Rex Tillerson, Trump's choice for secretary of state, has acknowledged the scientific consensus that the risks of climate change are real and need to be dealt with, he has been the chief executive of Exxon for the past 10 years.

In other words, Sessions will fit comfortably into an administration loaded with supporters of the fossil fuel industry. That leaves little hope federal authorities will take action on Exxon, said Joel Schwartz, a former federal prosecutor who worked on the prosecution of the tobacco industry.

"If they don't see climate change as causing a problem then there is no crime to prevent; there is no wrong to right," Schwartz said.  "Under their argument there can be no bad actors—just scientists with honest differences of opinion."

California Reps. Ted Lieu and Mark DeSaulnier were among the first to call for Lynch to open a probe of Exxon. The two Democrats asked the attorney general to determine whether Exxon had violated federal law by "organizing a sustained deception campaign disputing climate science" and "failing to disclose truthful information" about climate change.

The request came in the wake of an investigative series of stories published by InsideClimate News that reveals Exxon scientists were warning of potentially catastrophic effects of a buildup of atmospheric carbon dioxide from fossil fuels as early as 1977.  (The Los Angeles Times later published stories researched by the Columbia School of Journalism.)

The Justice Department confirmed in January that it had referred the request to the FBI for an initial inquiry, but no details were ever disclosed.

In May, Sessions was one of five Republican senators who demanded Lynch halt that preliminary investigation.

"We write today to demand that the Department of Justice (DOJ) immediately cease its ongoing use of law enforcement resources to stifle private debate on one of the most controversial public issues of our time—climate change," according to the letter.

Sessions was joined by Sens. Mike Lee, Ted Cruz, David Perdue and David Vitter in signing the letter that suggested a prosecution of Exxon would amount to prosecutorial misconduct.

"As you well know, initiating criminal prosecution for a private entity's opinions on climate change is a blatant violation of the First Amendment and an abuse of power that rises to the level of prosecutorial misconduct," they told Lynch.

David Vladeck, a professor at the Georgetown University Law Center and former director of the Bureau of Consumer Protection of the Federal Trade Commission, said the position staked out by Sessions and the others in the letter to Lynch is a signal Exxon will get a free pass at the federal level.

"That means it will be left to the state attorneys general to pick up the cudgel if there is going to be any holding Exxon accountable," he said.

But given Exxon's resources, its powerful allies in Congress and the ferocity it has shown in attacking the investigations being undertaken by New York and Massachusetts, other attorneys general may be reluctant to engage in litigation.

"They may believe it's the right thing to do, but they know they can't sustain the fight they will surely encounter," Vladeck said. "So Exxon...will go on about its business without being held accountable for its conduct."

Lieu and DeSaulnier, both Democrats from Southern California, are grudgingly accepting what lies ahead.

"It's not looking very encouraging," DeSaulnier said.

Lieu said he hopes the FBI will turn up enough evidence that cannot be ignored, but said, "I am pessimistic about the attorney general's office."

Exxon may also find a more agreeable Securities and Exchange Commission under the Trump administration. The SEC reportedly launched an investigation into how Exxon accounts for climate change impacts when it values its assets. Exxon has confirmed the SEC investigation and pledged its cooperation.

In the wake of the probe, Exxon announced in October that it was revising the estimated value of its Canadian tar sands reserves to conform to SEC guidelines.

On Wednesday, Trump announced lawyer Jay Clayton as his choice to replace Mary Jo White as SEC chair.  Clayton has represented a number of Wall Street giants and could be instrumental in helping implement Trump's promise to scale back on financial regulation.

In addition to designating a chair, the new president likely will be making three other appointments this year to the five-member commission.

The commission is designed as a non-partisan body, and no more than three commissioners may belong to the same political party. Appointees are subject to confirmation by the Senate.

Yet Trump will shape the commission with conservative appointees who will be industry-friendly and lenient enforcers of regulatory rules, according to experts.

It's unlikely Trump will appoint commissioners explicitly opposed to investigating Exxon, said Andrew Vollmer, a law professor at the University of Virginia and former deputy general counsel at the SEC. New Republican commissioners, however, are likely to share the president's ideological policy preferences, he said.

"The kind of people he will pick can influence and affect investigations," Vollmer said. "There is nothing improper about that as long as a commissioner does not have a conflict of interest."

Trump's appointee to head the SEC, for instance, could instruct the SEC's enforcement division to stop a particular investigation, he said. But that carries the risk of alienating staff and exposing the commission to public criticism, making the power more theoretical than real, he said.

Still, he said, "the chair has the power."

If allegations of wrongdoing came from a whistleblower, then the SEC would be mandated to conduct a summary investigation of Exxon, according to according to Bevis Longstreth, a former SEC commissioner who was appointed by Ronald Reagan. But even then, it need only be a cursory look to satisfy the statutory requirements that the credibility of whistleblower complaints be weighed, Longstreth said.

"I don't think you can look to the SEC—given what will be its be makeup—to do very much in the way of an Exxon investigation," he said.

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