On Monday, California’s Attorney General Rob Bonta took legal action aimed at compelling some of the world’s largest oil companies to surrender profits that the state alleges were obtained through deceptive practices related to their contributions to climate change. This move comes after a recent California law went into effect, granting the Attorney General the authority to seek the disgorgement, or surrender, of profits earned by companies while violating laws against unfair competition and false advertising.
Attorney General Bonta has added this disgorgement remedy to a lawsuit filed last year against energy giants Exxon Mobil, Chevron, Shell, BP, ConocoPhillips, and the American Petroleum Institute (API), an influential trade group representing the oil and gas industry. The lawsuit, filed in a state court in San Francisco, alleges that these companies have caused tens of billions of dollars in damages and accuses them of deceiving the public regarding their role in exacerbating climate change.
The American Petroleum Institute (API) has responded by dismissing the suit as meritless, characterising it as part of a “coordinated campaign” to wage “politicised lawsuits” against a crucial American industry and its workers. API’s General Counsel, Ryan Meyers, stated that climate policy should be debated and decided by Congress, not through a “patchwork of courts.”
Similarly, Shell has expressed its belief that climate change should not be addressed through the court system, advocating instead for a “collaborative, society-wide approach.” ConocoPhillips has declined to comment on the pending litigation, while Exxon, Chevron, and BP have not yet provided immediate responses.
This legal action by California’s Attorney General comes just days after United Nations Secretary-General Antonio Guterres called on countries to ban fossil fuel advertising, likening it to the regulation of tobacco and other products proven harmful to human health. Additionally, in recent weeks, major oil and gas companies have faced increasing pressure from activist shareholders demanding more corporate action on climate change, while some U.S. lawmakers have intensified their scrutiny into whether the industry has engaged in deceptive practices.