Battling for Big Oil: Manufacturing Trade Group Leads Assault on Climate Suits

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By Karen Savage, Climate Liability News.ย Crossposted fromย Climate Liability News.

In its fight to stave off a wave of climate change-related lawsuits, the fossil fuel industry has found a vocal and unapologetic ally in the National Association of Manufacturers (NAM). The 123-year old trade group represents a wide range of the nationโ€™s manufacturing companies, but it has frequently gone to bat for select segments of its membership during major liability battles. Currently, it is Big Oilโ€™s staunchest defender.

The group has filed briefs defending oil companies in liability lawsuits, launched campaigns to discredit the communities filing them, and has worked to stop shareholders from pressing the oil companies to disclose climate risks. In these roles, NAM has put itself front and center in the effort to keep fossil fuel companies from being held liable for their role in climate change, and from paying for the related damages that will run in the hundreds of billions of dollars to communities across theย country.

โ€œTaxpayer resources should not be used for baseless lawsuits that are designed to enrich trial lawyers and grab headlines for politicians,โ€ Lindsey de la Torre, executive director of NAMโ€™s spinoff group, the Manufacturersโ€™ Accountability Project (MAP),ย said in a statementย after Rhode Island filed one of the climate liability lawsuits last year. NAM launched MAP in 2017 as a response to the increasing number of climate liabilityย suits.ย 

Those suits, according to NAM, are a result of a coordinated campaign by activists โ€œto disparage U.S. manufacturers with a focus on Americaโ€™s largest energyย manufacturers.โ€ย 

MAP is now attempting to convince the American public โ€” as well as judges who might hear those liability cases โ€” that attempts to hold companies accountable for their role in climate change will harm business, said Richard Daynard, president of Northeastern University Law Schoolโ€™sย Public Health Advocacy Instituteย and chair of its Tobacco Products Liabilityย Project.

Manufacturers' Accountability Project logo
Theย Manufacturers’ Accountability Project (MAP) was launched in November 2017 to push back against climate-change-relatedย lawsuits affecting the manufacturingย industry.ย 

โ€œThis is essentially the PR front for the defendants in climate litigation,โ€ Daynard said, adding that MAP is also working to discourage municipalities from filing futureย suits.

โ€œThis is all part of a long history of tort reform propaganda,โ€ he said, adding that NAM has worked for decades to reign in all types of liability litigation, including against the tobaccoย industry.

So perhaps itโ€™s not surprising that NAMโ€™s defense of fossil fuel companies has begun to look increasingly like itsย support for the tobacco industryย in the 1980s. Similar tactics were used when tobacco companies were facing hundreds of lawsuits and were charged with racketeering by the federal government for deceiving the public about the catastrophic health hazards of smoking. NAM has even hired the same law firm that defended the tobacco industry to launch an assault on the climate liabilityย lawsuits.

NAMย recently namedย Phil Goldberg, a formerย coal lobbyistย as special counsel for MAP. Goldberg is a managing partner in the Washington office of Shook, Hardy & Bacon, whichย gained notorietyย for defending the tobacco industry, and is the co-chair of the firmโ€™s ย public policyย group.ย 

Some say Shook, Hardy & Bacon wentย beyondย defending tobacco companies, actively coordinating efforts by its clients to deliberately deceive the public about the ruinous health effects ofย smoking.

Judge Gladys Kessler, of the U.S. District Court for the District of Columbia, who found 10 tobacco companies guilty of violating racketeering laws in 2006,ย said the companyโ€™s lawyersย โ€œplayed an absolute central role in the creation and perpetuationโ€ of the companiesโ€™ โ€œfraudulent schemes,โ€ calling it a โ€œsad and disquieting chapterโ€ in the legalย profession.

Even before Goldberg was hired, MAP had launched an offensive against climate suits, filing friend-of-the-court briefs and intervening in a landmark constitutional suit brought by 21 young people against the U.S. government. MAP has also submitted public recordsย requestsย and coordinated aย public relationsย campaignย toย discreditย the municipalities behind the liabilityย lawsuits.

Sharon Eubanks, a former Department of Justice lawyer who led the governmentโ€™s racketeering case against the tobacco industry, said MAP is launching a direct attack on climate litigationย suits.

โ€œItโ€™s very similar what theyโ€™re doing, only the tobacco industry at least didnโ€™t come right out and say โ€˜Weโ€™re going to target these lawsuits directly,โ€™โ€ Eubanks said. โ€œThey did so indirectly. But NAM and MAP, theyโ€™re like, โ€˜Weโ€™re targeting theย lawsuits.โ€™โ€ย 

Michael Barnett, a professor of management & global business atย Rutgers Business Schoolย who has studied trade associations, said groups like NAM exist to defend the interests of theirย industry.ย 

โ€œItโ€™s sort of an outsourced arm of those firms, rather than doing it all on their own, thereโ€™s strength in numbers,โ€ Barnett said. โ€œThereโ€™s some efficiency to having one centralized legal defense that attacks on behalf of the whole industry in addition to each of the individual firms taking on theseย issues.โ€

No Stranger to the Liabilityย Battlefield

The addition of Goldberg to MAPโ€™s legal team indicates a continuing commitment to defending NAMโ€™s fossil fuel defendants. In addition to being the go-to law firm for tobacco companies,ย Shook, Hardy & Baconย has a long history with NAM,ย partneringย as far back as 2007 to support firms facing product liability suits. The firmย worked so closelywith the tobacco industry toย attack the scienceย showing the dangers of smoking it wasย namedย in several cases along with their clients, charging them with deceiving the public by fraudulently concealing the health effects of smoking. Oklahomaโ€™s attorney general called Shook, Hardy & Bacon an โ€œaider and abettorโ€ of fraud in oneย suit.

โ€œ[The Department of Justice] considered suing them and making them defendants because they were so much a part of the RICO violations we alleged,โ€ Eubanksย said.

โ€œTheyโ€™re not even hiding from anything, theyโ€™re just saying โ€˜we want to influence whatโ€™s happening in these cases the best way that weย can.โ€™โ€ย 

She said sheโ€™s seen no evidence that MAPโ€™s tactics are illegal, but they are similar to some of what was alleged in the tobaccoย cases.

Goldberg did not respond to a request for comment. In a NAM press release he said, โ€œThe NAM and its Manufacturersโ€™ Accountability Project are the tip of the spear in the fight against the wave of unfounded public nuisance lawsuits targeting Americaโ€™sย manufacturers.โ€ย 

Goldberg said climate liability suits get in the way of finding real solutions and โ€œare more about politics than addressing the global challenge of climate change.โ€ He did not elaborate on what the solutions are or how municipalities will pay for the infrastructure needed to protect their residents, costs that are projected to run into the hundreds of billions of dollarsย nationwide.

A History of Advocating for Fossil Fuelย Members

NAM, whichย was foundedย in 1895, describes itself as the largest manufacturing association in the United States. It doesnโ€™t publicly disclose its membership list, but its board includes some of the oil and gas industryโ€™s most powerfulย executives.ย 

Exxon senior vice president and management committee memberย Neil Chapmanย joined NAMโ€™s executive committee in 2015, taking over the position vacated by current Exxon chief executive Darren Woods. Chapman, whoย donatedย $10,000 to NAMโ€™s political action committee during the 2018 election cycle, also serves as NAMโ€™s southwest regional vice chair.ย ย 

Chapman and Exxon did not respond to a request forย comment.ย 

For decades, the association has promoted climate denial,ย foundingย theย Global Climate Coalitionย in 1989 and sharing offices until 1992 while the Global Climate Coalition and itsย membersย โ€” primarily energy companies and automobile manufacturers โ€” worked to cast doubt on what was fast becoming overwhelming scientific evidence that the burning of fossil fuels drives climate change. The goal was to change the publicโ€™s perception and cast doubt on climateย science.

The Global Climate Coalition was disbanded in 2002 after several of its largest corporate members pulled out under public pressure to accept that climate change โ€” and the projected catastrophic effects โ€” was an undeniable globalย threat.

More recently, NAMโ€™s focus has shifted from promoting climate deception to defending member companies from efforts to hold them accountable for years of deceiving the public and damaging theย climate.

Along with the American Petroleum Institute and American Fuel & Petrochemical Manufacturers, NAM in 2015 joined the landmark youth climate lawsuitย Juliana v. United Statesย as an intervenor on the side of the federalย government.ย 

Calling the suit a โ€œdirect threat to businesses,โ€ the trade associations said the โ€œsignificant reduction in [greenhouse gas] emissions would cause a significant negative effect on [their] members by constraining the sale of the product they have specialized in developing and selling.โ€ When the court asked intervenors to explain their views on climate change, NAM quicklyย backed out.

When the liability lawsuits began โ€” and now total more than a dozen from communities across the country and one state (Rhode Island) โ€” NAM responded byย launchingย MAP to โ€œset the record straight and highlight foundations and other activists who have sought to undermine and weaken manufacturing in the United Statesโ€ by engaging in climate change-relatedย litigation.ย 

MAP came out swinging,ย claimingย that then-New York attorney general Eric Schneidermanโ€™s use of the Martin Act to investigate Exxon for possible climate change-related fraud was โ€œpolitically motivated.โ€ Itย demandedย New York Mayor Bill de Blasio apologize to New Yorkers for using an outside firm to file its suit against five major oil companies and launched a campaign to highlight what it called de Blasioโ€™s โ€œpolitically-motivated attacks onย manufacturers.โ€

Eubanks said that rhetoric doesnโ€™t addย up.

โ€œLawsuits are to enforce the law, to ensure that people are following the law and it takes you out of a political process and puts you before a neutral person, a judge,โ€ she said, adding that Shook, Hardy & Bacon also does a good bit of politicalย lobbying.ย 

โ€œThey say, โ€˜We think these matters should be handled by legislation, not litigation, and by regulations that will come out of any statutes that are enacted,โ€ she said. โ€œThen they fight real hard to make sure there are no statutes that come down the pike because regulations come out of regulatory authority, so it sounds real good, but thatโ€™s wholly inconsistent with theirย approach.โ€ย 

NAM and MAP have made a big deal out of the potential for future RICO charges against the fossil fuel industry โ€” the same racketeering laws that ultimately ensnared the tobacco industry โ€” and contend that a conspiracy is being waged on the other side by a โ€œgroup of politically motivated activistsโ€ who are โ€œtrying to take down Americaโ€™s energyย manufacturers.โ€ย 

โ€œRight now, there are groups of trial lawyers slinking around the country tantalizing elected officials in cities and states with unrealistic promises of jackpot justice if they will only agree to sue energy manufacturers over climate change,โ€ย saidย NAM president and chief executiveย Jay Timmons in NAMโ€™s State of Manufacturing Address last week in Houston. โ€œThese lawyers โ€” they want to get rich at the expense of manufacturingย workers.โ€

Daynard said this type of messaging is used in an effort to control the narrative around โ€” and media coverage of โ€” climateย litigation.

โ€œThey have this notion that if they can get continue to get news coverage and establish themselves, they can make sure when cases are filed journalists will look, go to them and they can then get in some comment on how this is all worthless crazy stuff stirred up by โ€˜greedy lawyersโ€™ or โ€˜ideologically driven NGOโ€™s,โ€™โ€ Daynardย said.

To try and substantiate its view that litigation is part of a vast conspiracy โ€” and in what some say is an attempt to have a chilling effect on municipalities that file lawsuits โ€” MAP has also submitted extensive public record requests to plaintiffs in the suits, seeking documents and communication between the municipalities and their attorneys, prior records requests that include those attorneys, certain communication regarding the defendant companies and communication between the municipalities and billionaire Tom Steyer, founder of NextGen, a progressive organization working to stem the risks of climate change for futureย generations.

When Rhode Island Attorney General Peter Kilmartinย filed the first state-level suitย last July, MAP denouncedย it.ย 

Eubanks said ensuring manufacturers abide by state law is exactly what attorneys general shouldย do.

โ€œWe have consumer protection statutes, we have consumer protection agencies, thatโ€™s part of what makes this country great,โ€ Eubanks said. โ€œYou canโ€™t just come in and roll over people with deceptive and unfair methods of competition, you canโ€™t just lie about things without consequences and we have organizations to protect that. Thatโ€™s what I find so alarming about this โ€” the whole idea that thereโ€™s something wrong with enforcing theย law.โ€

NAM did not respond to a request for comment. De la Torreย could not be reached forย comment.

Perhaps NAMโ€™s biggest attack on liability suits thus far has been its accusations against several California municipalities.ย ย 

Not long after the suits were filed, Exxon went on theย offensive,ย accusingย plaintiffs of failing to disclose climate risks to their bondย investors.ย 

To try to bolster that allegation, NAM โ€” along with the industry allyย Competitive Enterprise Instituteย โ€” asked the Securities and Exchange Commission toย investigateย whether several cities and counties that filed climate suits misled investors when they stated in bond offerings that they couldnโ€™t predict the impacts of climateย change.ย 

Aย reportย by the former chief of the Securities and Exchange Commissionโ€™s municipal bonds division later found the municipalities did not mislead potentialย investors.

In another instance, NAM partnered with the Chamber of Commerce to back Exxon,ย filingย a friend-of-the-court brief in the oil giantโ€™s quest to stop investigations by the attorneys general of Massachusetts and Newย York.ย 

New York has since filed a lawsuit against Exxon based on that investigation,ย allegingย the oil giant for years deceived investors by deliberately downplaying the climate risks to its business and long-term financial health. The Supreme Court recentlyย ruledย against Exxonโ€™s attempt to stop Massachusettsโ€™ investigation, which nowย continues.

This is the first in a series of articles on the trade group coordinating opposition to climate liabilityย suits.

Main image:ย President Donald J. Trump delivers remarks to the National Association of Manufacturers (NAM) Friday, September 29, 2017, at the Mandarin Oriental Hotel in Washington, D.C. Credit: White House, publicย domain

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