Description: Action by New York Attorney General to compel compliance with subpoenas issued in its investigation of Exxon Mobil Corporation's climate change disclosures.
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People v. PricewaterhouseCoopers LLP
Case Documents:
Filing Date Type File Action Taken Summary 08/29/2018 Order Download Order issued requiring responses to discovery demands. New York Court Ordered Exxon to Respond to Attorney General’s Document Requests, Interrogatory; Indicated That Investigation Should Conclude Soon. At a hearing on August 29, 2018, a New York trial court ordered Exxon to produce 14 “readily available” or “easily produceable” spreadsheets that the New York attorney general sought in its investigation into Exxon’s climate change-related disclosures (but not 12 other spreadsheets requested by the attorney general that Exxon said would require extensive work). Exxon must also respond to an interrogatory to be served by the attorney general, which the attorney general indicated would concern whether Exxon applied a directive to use an “alternate methodology” to for accounting for greenhouse gas costs to assets and businesses across the company. In addition, Exxon agreed to provide documents it had already provided to the Securities and Exchange Commission but not to the attorney general. At the outset of the hearing, the judge told the attorney general that “this cannot go on interminably” and that “you’ve been investigating for two years. So you’re either going to file a case or you’re not going to file a case.” The attorney general indicated it was coming to an end of the investigation. Exxon told the court, “If they have a theory, they should bring a case. They should either put up or shut up.” 08/29/2018 Transcript Download Transcript of August 29, 2018 hearing. 08/27/2018 Letter Download Letter submitted by Exxon Mobil Corporation attaching letter from SEC indicating that it would not pursue enforcement action against Exxon. 08/27/2018 Letter Download Letter submitted by attorney general responding to Exxon letter regarding SEC notification that it would not pursue enforcement action. 07/18/2018 Reply Download Reply memorandum of law filed by attorney general in further support of motion to compel compliance with investigatory subpoenas. 07/09/2018 Brief Download Brief filed by Exxon in opposition to New York attorney general's motion to compel. 06/19/2018 Affirmation Download Affirmation of John Oleske filed in support of motion to compel compliance with investigatory subpoenas. 06/19/2018 Affirmation Download Affirmation of Jonathan Zweig filed in support of motion to compel compliance with investigatory subpoenas. 06/19/2018 Memorandum of Law Download Memorandum of law filed by attorney general in support of motion to compel compliance with investigatory subpoenas. 06/19/2018 Motion Download Notice of motion to compel compliance with subpoenas filed by attorney general. New York Attorney General Asked State Court to Order Exxon to Turn Over Documents Showing How Company Accounted for Climate Change. The New York attorney general filed a motion to compel Exxon Mobil Corporation (Exxon) to produce certain documents in response to subpoenas issued by the attorney general in the investigation of Exxon’s climate change-related disclosures. The attorney general said Exxon had failed to produce cash flow spreadsheets used to make investment decisions, conduct corporate planning reviews, estimate company reserves and resource base quantities, and conduct asset impairment evaluations with respect to 26 major projects and assets “that are among the company’s largest and most at risk due to climate change.” The attorney general argued that the spreadsheets were highly relevant to whether and the extent to which Exxon incorporated a proxy cost for greenhouse gas emissions in its decision-making—which the attorney general characterized as a “key safeguard that Exxon has frequently touted.” The attorney general also said Exxon had continued to resist requests for documents provided by Exxon to the Securities and Exchange Commission (SEC) concerning impairment evaluations, reserves calculations, and climate change on the grounds of federal preemption. The attorney general argued that Exxon was precluded from arguing that SEC regulations preempted the attorney general’s investigation since the federal district court for the Southern District of New York had already rejected this claim in its March 2018 dismissing Exxon’s federal lawsuit challenging the investigation. 06/16/2017 Transcript Download Orders issued regarding compliance with subpoenas. New York Trial Court Set Parameters for Exxon’s Compliance with Attorney General’s Climate Change Investigation. At a hearing on June 16, 2017, the New York Supreme Court indicated that the New York Attorney General could conduct interrogatories and depositions in its investigation of Exxon Mobil Corporation’s (Exxon’s) climate change-related disclosures but that the court would not require Exxon to respond to the attorney general’s second round of document requests. The court ordered Exxon to produce four witnesses to testify about their compliance with the attorney general’s earlier document requests, to produce an employee of a federal subsidiary for a deposition, and to update production of documents in accordance with the attorney general’s requests through 2016. The court indicated that the attorney general had broad power to propound the interrogatories. The court, which issued its orders in response to motions to quash (by Exxon) and to compel (by the attorney general), indicated that the matter should be taken to the Appellate Division if the parties disagreed with the scope of compliance with the attorney general’s subpoenas that the court was ordering. 06/14/2017 Reply Download Reply memorandum of law submitted in support of attorney general's cross-motion to compel. 06/09/2017 Opposition Download Opposition filed to attorney general's cross-motion to compel and reply filed in support of motion to quash. 06/02/2017 Affirmation Download Affirmation filed in opposition to Exxon's motion to quash and in support of attorney general's cross-motion to compel. 06/02/2017 Brief Download Memorandum of law filed in opposition to Exxon's motion to quash and in support of attorney general's cross-motion to compel. Attorney General Filed Cross-Motion to Compel. On June 2, 2017, the Attorney General filed papers defending the subpoenas and cross-moving to compel. The Attorney General said in a brief and affirmation that the investigation had uncovered evidence of potentially false and misleading statements regarding Exxon’s application of the proxy cost of greenhouse gases in its decision-making. The Attorney General argued that the new subpoenas were necessary to fill in gaps in Exxon’s production of documents related to the company’s risk-management practices, and that the testimonial subpoenas were also reasonably related to the investigation. The Attorney General disputed Exxon’s characterization of the subpoenas as unduly burdensome and as making improper demands for information. The Attorney General also argued that its prospective enforcement actions under New York’s anti-fraud statutes were not subject to federal preemption. 05/19/2017 Brief Download Brief submitted by Exxon in support of motion to quash and for a protective order. 05/19/2017 Motion Download Order to show cause filed by Exxon. Exxon Sought to Quash New Subpoenas from New York Attorney General. On May 19, 2017, Exxon filed an order to show cause seeking to quash the document subpoena and four testimonial subpoenas that related to past subpoena compliance. Exxon argued that the Attorney General had not provided a factual basis to justify the demand for additional records and, moreover, that the Attorney General had impermissibly demanded that Exxon review and synthesize information and compile spreadsheets and summaries not already in existence. Exxon also contended that the Attorney General was probing areas foreclosed from state inquiry by federal regulation. 05/08/2017 Subpoena Download Subpoena issued by New York attorney general to Exxon Mobil Corp. New York Attorney General Served New Subpoenas on Exxon in Climate Change Investigation. On May 8, 2017, the Office of the New York State Attorney General served 10 subpoenas on Exxon Mobil Corporation (Exxon) in its investigation of Exxon’s climate change-related disclosures. One subpoena sought information and documents related to oil, gas, and other hydrocarbon projects approved, deferred, or declined by Exxon and “proxy costs” associated with those projects to reflect policies to stem greenhouse gas emissions. The subpoena also demanded information related to Exxon’s decisions regarding impairment or write-downs for oil and gas projects and Exxon’s estimates of its oil and gas reserves. In addition, the subpoena sought more recent documents responsive to the Attorney General’s November 2015 subpoena and documents provided to the U.S. Securities and Exchange Commission in its climate change investigation of Exxon. The other nine subpoenas were testimonial subpoenas. 03/22/2017 Order Order issued at compliance conference. New York Court Ordered Exxon to Provide More Information About Tillerson’s Secondary “Wayne Tracker” Email Account. A New York State Supreme Court reportedly ordered Exxon Mobil Corporation (Exxon) to submit affidavits by March 31 explaining its procedures for searching for and providing documents in response to a subpoena issued by the New York Attorney General in its investigation of potential violations of New York consumer, business, and investor-fraud laws in connection with Exxon’s climate change disclosures. The attorney general’s office notified the court on March 13 of its concerns regarding Exxon’s good faith in responding to the subpoena and asked the court to schedule a compliance conference. The attorney general noted, among other things, that Exxon had produced only 700 documents associated with its management committee members, including former chairman and chief executive Rex Tillerson. The attorney general said that new information regarding a secondary email account used by Tillerson under the name “Wayne Tracker” lent “additional urgency” to the request that the court intervene. Exxon defended its response to the subpoena, noting that the Wayne Tracker email account was used by “a limited group of senior executives” for purposes of organizing and prioritizing emails. Exxon said that it had searched the Wayne Tracker account when complying with the subpoena, though the company acknowledged that the account had not been subject to the automatic litigation hold after receipt of the subpoena and that documents in certain timeframes had therefore not been available for review. Exxon indicated that other email custodians did not use secondary accounts. The court ordered Exxon to explain what documents might have been lost and to explain how they might have been lost. The court also directed Exxon to provide documents associated with its management committee by March 31. A written order was not available at the time of this writing. 03/21/2017 Letter Download Letter submitted by Exxon. 03/20/2017 Letter Download Letter submitted by attorney general. 03/16/2017 Letter Download Letter submitted by Exxon in response to attorney general's request for compliance conference. 03/13/2017 Letter Download Letter submitted by attorney general requesting compliance conference. 12/01/2016 Letter Download Letter submitted to court by New York Attorney General regarding production schedule. On December 1, the attorney general informed the court that though the parties had agreed in principle to a production schedule, they disagreed on “the parameters of what constitutes a reasonable production.” The attorney general asserted that Exxon continued “to insist on producing from a select group of custodians using search terms it has been advised repeatedly are inadequate.” Specific gaps mentioned in the attorney general’s letter to the court included documents regarding the proxy cost of carbon that Exxon said it used to integrate the impact of climate change into its business and information related to climate change and oil and gas reserves. The court scheduled a hearing for December 6. 11/21/2016 Not Available Download Hearing held and parties directed to . On November 21, the New York State Supreme Court said it would deny the New York Attorney General's motion to compel a response to its investigative subpoena but that if the parties could not reach an agreement on a date for production, it would fix a date and, if necessary, “arbitrate what are reasonable or unreasonable search terms.” 11/14/2016 Motion Download Memorandum of law filed in support of motion to compel compliance with investigative subpoena. New York Attorney General Asked State Court to Order Exxon’s Production of Documents in Climate Change Investigation. In New York Supreme Court, the New York Attorney General moved to compel Exxon Mobil Corporation to respond to its November 2015 subpoena seeking climate change-related documents pursuant to New York anti-fraud laws. The attorney general said that approximately five months prior to its motion it had asked Exxon to prioritize production of documents concerning the company’s valuation, accounting, and reporting of its assets and liabilities, and the impact of climate change on those processes, but that Exxon had not cooperated with this request. The attorney general told the court that despite acknowledging in New York court that the subpoena was valid, Exxon was “effectively moving to quash the subpoena” in federal court in Texas. The attorney general attributed Exxon’s delay in responding to its prioritization request as an effort to “forestall judicial intervention” in New York until it obtained an injunction from the federal court. 10/26/2016 Decision Download Decision and order issued. New York Court Ordered Exxon and Its Accountant to Comply with Attorney General’s Subpoena. The New York Supreme Court ordered Exxon Mobil Corporation (Exxon) and its accounting firm, PricewaterhouseCoopers LLP (PwC), to comply with a subpoena issued by the New York Attorney General to PwC in August 2016. The court rejected Exxon’s argument that it could withhold documents based on an accountant-client privilege under Texas law. The court concluded that Texas law would not preclude production of the requested documents, but that, in any event, New York law—which does not recognize an accountant-client privilege—was applicable. 10/24/2016 Not Available Download Hearing held (transcript filed on October 27, 2016). 10/21/2016 Opposition Download Memorandum of law filed by Exxon in support of opposition to motion to compel compliance with investigative subpoena. 10/21/2016 Reply Download Reply memorandum of law filed by New York attorney general in support of motion to compel compliance with investigative subpoena. 10/17/2016 Not Available Download Affirmation filed by Exxon in support of opposition to application for order to show cause. 10/17/2016 Not Available Download Supplemental affirmation submitted in support of motion to compel compliance with investigative subpoena. 10/17/2016 Opposition Download Memorandum of law filed by Exxon in support of opposition to application for order to show cause. 10/14/2016 Motion Download Memorandum of law filed by New York attorney general in support of motion to compel compliance with investigative subpoena. The New York attorney general filed an application for an order to show cause on after Exxon Mobil Corporation (Exxon) notified the attorney general's office that it intended to assert that some documents requested in the subpoena to PricewaterhouseCoopers LLP (PwC), Exxon's accounting firm, were shielded from disclosure by an accountant-client privilege. In its papers supporting its application, the attorney general said that PwC had served as Exxon’s independent auditor since before 2010 (the time period covered by the subpoena), a role in which PwC examined whether Exxon’s financial statement disclosures were supported by evidence. The attorney general said that PwC also served from at least 2008 to 2013 as global advisor and report writer for the Carbon Disclosure Project, a non-profit organization that functions as a global disclosure system for environmental information, including greenhouse gas emissions, from companies including Exxon. 10/14/2016 Motion Download Affirmation filed by New York attorney general in support of motion to compel compliance with investigative subpoena. 08/19/2016 Subpoena Download Subpoena issued to PricewaterhouseCoopers LLP. The New York attorney general issued a subpoena to PricewaterhouseCoopers LLP (PwC), the accounting firm for Exxon Mobil Corporation (Exxon), as part of its investigation into Exxon’s representations to investors and to the public about risks related to climate change. The subpoena sought documents and communications related to PwC’s audits of Exxon, including documents concerning the impacts on Exxon’s financial statements or business of climate change, climate change policies, the cost of carbon, regulations limiting or discouraging use of fossil fuels, policies incentivizing renewable energy, and changes in the prices of oil, gas, and other hydrocarbons. -
Matter of People of the State of New York v. PricewaterhouseCoopers LLP
Case Documents:
Filing Date Type File Action Taken Summary 09/12/2017 Order Leave to appeal order requiring accounting firm's compliance with subpoena denied. New York High Court Denied Exxon Leave to Appeal Decision Requiring Accounting Firm to Comply with Attorney General’s Subpoena. The New York Court of Appeals denied Exxon Mobil Corporation’s motion for leave to appeal an intermediate appellate court’s decision upholding a trial court order requiring Exxon’s accounting firm to respond to a subpoena issued by the New York Attorney General in his investigation of Exxon’s climate change-related disclosures. The intermediate appellate court had agreed with the trial court that an accountant-client privilege did not exist to shield the accounting firm from complying with the subpoena. -
People of the State of New York v. PricewaterhouseCoopers LLP
Case Documents:
Filing Date Type File Action Taken Summary 05/23/2017 Decision Download Trial court order affirmed. New York Appellate Court Affirmed That Exxon’s Accounting Firm Had to Comply with Attorney General’s Subpoena in Climate Investigation. The New York Appellate Division affirmed a trial court order requiring Exxon Mobil Corporation’s (Exxon’s) accounting firm to comply with a subpoena from the New York State Attorney General in its investigation into Exxon’s climate change-related disclosures. The Appellate Division ruled that the court below had properly found that New York law on privilege applied and did not recognize an accountant-client privilege. The appellate court rejected Exxon’s contention that courts should apply an “interest-balancing analysis” to decide whether New York or Texas choice of law should govern the evidentiary privilege. 12/07/2016 Brief Download Brief filed by New York Attorney General opposing reversal of trial court order. 11/07/2016 Brief Download Brief filed by Exxon Mobil corporation. Exxon Mobil Corporation (Exxon) filed a brief arguing that the New York Appellate Division should reverse a trial court ruling that an evidentiary accountant-client privilege created by Texas law did not bar the trial court from ordering Exxon's accounting firm to produce certain documents.