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Texas Court Grants ExxonMobil Right to Examine Massachusetts AG Records

ExxonMobil Corp. won a partial victory Thursday after a Texas district court judge opened the door to allow Massachusetts Attorney (AG) General Maura Healey's internal phone records and depositions be examined regarding a multi-state investigation into whether the oil major intentionally hid research concerning the impact of its operations on the environment.

The discovery order issued by U.S. District Judge Ed Kinkeade of the Northern District in Fort Worth warned that Healey may have acted in bad faith in the probe. However, he said he would wait for the results of discovery by both sides before deciding whether to grant a preliminary injunction against Healey, as ExxonMobil has requested.

New York AG Eric Schneiderman, later joined by more than a dozen states and Washington, DC, last fall subpoenaed ExxonMobil, demanding financial records, emails and other documents that date back to the 1970s regarding its climate change research (see Daily GPI, June 30; Oct. 23, 2015). Healey, part of Schneiderman's effort, issued a separate state subpoena in April; ExxonMobil responded by suing in the Fort Worth court, calling the probe a "fishing expedition" (see Daily GPI, Aug. 10). ExxonMobil also is seeking to bar enforcement of Healey’s civil investigation demand (CID), which was filed in Massachusetts.

ExxonMobil has argued that the AGs are pursuing a political agenda that is aligned with anti-fossil groups.

In his ruling, Kinkeade said if Healey had prejudged ExxonMobil and issued her subpoenas in bad faith, the Texas court could intervene, as the company is headquartered in Irving. The judge cited a press conference on March 29, billed as "AGs United for Clean Power," in which Healey, Schneiderman and other AGs announced the ExxonMobil probe.

Notably, the morning before the press conference, "Healey and other attorneys general allegedly attended a closed door meeting," where they "listened to presentations from a global warming activist and an environmental attorney that has a well-known global warming litigation practice," Kinkeade wrote. "Both presenters allegedly discussed the importance of taking action in the fight against climate change and engaging in global warming litigation."

One presenter, Matthew Pawa of Pawa Law Group PC, "has allegedly previously sued Exxon for being a cause of global warming...After the closed door meeting, Pawa emailed the New York attorney general's office to ask how he should respond if asked by a Wall Street Journalreporter whether he attended the meeting with the attorneys general. The New York attorney general’s office responded by instructing Pawa 'to not confirm that [he] attended or otherwise discuss' the meeting he had with the attorneys general the morning before the press conference."

The "anticipatory nature" of Healey's remarks is "concerning to this court," Kinkeade said. "Healey’s actions leading up to the issuance of the CID causes the court concern and presents the court with the question of whether...Healey issued the CID with bias or prejudgment about what the investigation of Exxon would discover."

If the allegations are true, it may constitute bad faith in issuing the CID, Kinkeade ruled. "Healey’s comments and actions before she issued the CID require the court to request further information so that it can make a more thoughtful determination about whether this lawsuit should be dismissed for lack of jurisdiction."

Healey's investigation "and others like it are part of an orchestrated campaign against our company that is without legal merit," an ExxonMobil spokesman said.

Healey's spokeswoman said investors and consumers "have a right to understand what Exxon knew about the impact of fossil fuels and when. Despite its claims, Exxon is subject to the laws of our state and is accountable for any misrepresentations it may have made. We will continue to fight aggressively on the basis of our clear legal authority."

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