ESG Enforcement Tracker

Key facts:

The City of New York filed a lawsuit against Exxon, Shell, BP, and the American Petroleum Institute (API) for violating its Consumer Protection Law by systematically and intentionally misleading New York City consumers about their products’ role in causing climate change.

It alleged that the defendants’ product promotions suggested that consumers’ purchases of fossil fuel products would assist in addressing climate change, but that these promotions failed to disclose the impacts of the use of those fossil fuels and that the defendants have pursued “aggressive and multi-pronged greenwashing campaigns” which allegedly falsely present the defendants as leaders in combating climate change.

In addition, the City alleged that American Petroleum Institute engaged in greenwashing by exaggerating and misrepresenting the environmental benefits of its members’ products and by misrepresenting its members’ investments in clean energy as well as oil and gas’s role in combatting climate change. The City argued that the oil companies and the API, the oil and gas industry’s largest trade association, are using tactics similar to those of “Big Tobacco”.

In November 2021, the Federal District Court for the Southern District of New York stayed New York City’s consumer protection law climate change case against oil and gas companies and the API pending the Second Circuit’s decision in Connecticut v. Exxon Mobil Corp.

On 4 October 2023, the stay was lifted and the City of New York’s motion to remand to state court was denied without prejudice and with leave to refile. On 20 October 2023, the City of New York filed a renewed motion to remand the matter to the state court. On 14 November 2023, the defence filed a response opposing the renewed motion to remand, arguing that the matter belonged in the federal court.

This lawsuit follows a similar action brought in 2018, when the City of New York sued BP plc, Chevron Corporation, ConocoPhillips, Exxon Mobil Corporation, and Royal Dutch Shell plc, alleging that the defendant energy companies “promote[d] fossil fuel consumption” by “downplay[ing] the threat posed by climate change.” The district court dismissed the City’s 2018 complaint.