Recently, a former employee of the Exxon Mobil Corporation filed a class action lawsuit alleging that current and former workers’ retirement savings have taken a major hit as a result of the $360 billion energy giant’s fraudulent denial that global warming would affect the value of its oil and gas reserves.
The complaint claims that due to the known business risks associated with climate change, the company should have been more cautious in claiming how much its hydrocarbon reserves were worth.
In the complaint it is written: “Defendants’ breaches of fiduciary duty occurred when they knew or should have known that Exxon’s stock had become artificially inflated in value due to fraud and misrepresentation, thus making Exxon stock an imprudent investment under [the Employee Retirement Income Security Act].”
While Exxon “did nothing” to address this fraud, its shares fell more than $95, to about $82, during the proposed class period — Nov. 1, 2015, through Oct. 28, 2016 — costing its employees millions.
Exxon spokesman Alan T. Jeffers called the lawsuit “frivolous” in a statement, while going on to say, “We will defend ourselves and are confident our financial reporting and communications with investors fully comply with all legal and accounting requirements. This lawsuit misstates our financial reporting and repeats the same tired allegations pushed by activists and inaccurate media reports that claim we reached definitive conclusions about climate change decades before the world’s experts and while climate science was in an early stage of development.”
The suit also names five Exxon vice presidents — Bradley W. Corson, Suzanne McCarron, Malcolm Farrant, Neil Chapman and D.G. “Jerry” Wascom — as defendants, saying they had control over the company’s employee stock plan. Exxon stock represented the single largest holding of the plan, about $10 billion, according to the filing.
Exxon is already facing litigation on behalf of its stock in Dallas federal court tied to the alleged misconduct. It also is embroiled in potentially high-stakes fights with New York Attorney General Eric T. Schneiderman and Massachusetts Attorney General Maura Healey, whose offices claim the company has misled the investing public for decades.
The plaintiffs in the newly filed suit are represented by Samuel E. Bonderoff, Jacob H. Zamansky and Edward H. Glenn of Zamansky LLC and J. Hampton Skelton of Skelton & Woody.
For reference, the suit is Fentress et al. v. Exxon et al., case number 4:16-cv-03484, in the U.S. District Court for the Southern District of Texas, and a full copy of the complaint can be found here.
If you believe to have been affected by these alleged wrongdoings, please contact Consider The Consumer immediately and we will guide you through your next possible steps!