Puerto Rican cities sue Big Oil under RICO, alleging collusion on climate denial

  • Municipalities say ExxonMobil, Shell and others colluded to intentionally mislead consumers
  • The devastating 2017 hurricane season was exacerbated by climate change, the lawsuit says

(Reuters) – Puerto Rican municipalities have filed a lawsuit in federal court, saying ExxonMobil Corp, Shell Plc, Chevron Corp and others colluded to publicly downplay the risks of their fossil fuel products on climate change and are financially responsible for the damage caused by the devastating 2017 hurricane season, which was made worse by global warming.

The group of 16 municipalities last week filed what they called the first lawsuit of its kind against about a dozen fossil fuel companies and others. The cities say the companies coordinated a multibillion-dollar “fraudulent marketing scheme” to convince consumers that fossil fuel products don’t change the climate. That campaign ran counter to the companies’ own studies showing their products are accelerating climate change, leading to more deadly storms, the lawsuit says.

The municipalities said the companies outlined a scheme to defraud in a joint memo aimed at international climate negotiations in the 1990s. The coordinated deception spanning decades violates, among other things, U.S. racketeering and antitrust laws, it claims the trial.

“Puerto Rico has been hit by the perfect storm and is the ultimate victim of global warming,” Marc Grossman, a partner at Milberg Coleman Bryson Phillips Grossman, a firm that represents municipalities, said in a statement.

Shell spokeswoman Anna Arata said in a statement that addressing climate change requires a “society-wide” approach, and the company does not believe the courtroom is the right place to address the issue.

Exxon spokesman Casey Norton said legal proceedings like this “waste millions of dollars of taxpayer money and do nothing to promote meaningful action that reduces the risks of climate change.”

Theodore Boutrous of Gibson Dunn and Crutcher, an adviser to Chevron, said “the lawsuit is a baseless distraction from the serious challenge of global climate change, not an attempt to find an effective solution.”

The 2017 Atlantic hurricane season, with six major hurricanes and more than a dozen named storms, caused at least $294 billion in damage across the U.S., according to the lawsuit. Hurricanes Irma and Maria contributed to about 4,600 deaths and the failure of critical infrastructure in Puerto Rico, municipalities said.

The lawsuit claims oil companies should pay for damage from the storms, which municipalities said was exacerbated by climate change, including lost education and health care opportunities and tourism revenue.

Dozens of municipalities across the United States have sued oil companies for climate change damages and adaptation costs, mostly in state court. Those trials have been delayed amid numerous jurisdictional battles, and the Supreme Court has been asked to consider where those cases belong.

The case is The Municipalities of Bayamon et al. v. Exxon Mobil Corp. et al., United States District Court for the District of Puerto Rico, case no. 3:22-cv-01550.

For municipalities: Marc Grossman, Melissa Sims and Vicki Maniatis of Milberg Coleman Bryson Phillips Grossman

For oil companies: Not immediately available

Our Standards: The Thomson Reuters Trust Principles.

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