Columbia Law Prof.: Schneiderman’s #ExxonKnew Probe an “Abuse of Extraordinary Powers”
Monday August 15, 2016
Yet another legal expert has joined at least 12 others in calling New York Attorney General Eric Schniederman’s investigation of ExxonMobil legally flimsy. This morning, Columbia Law Professor Merritt B. Fox published an op-ed in the National Law Journal with a scathing review of Schneiderman’s use of the Martin Act to investigate ExxonMobil, noting that the whole affair is an “abuse” of “extraordinary powers.” As Fox states,
“The Martin Act grants the attorney general extraordinary powers to subpoena private documents without either obtaining a court order, which is required in most ordinary New York criminal proceedings, or the filing of a complaint, which is required in an ordinary civil action and is subject to court review. The Exxon subpoena is an abuse of these extraordinary powers.” (emphasis added)
Fox continues,
“The bigger, more unambiguous problem for Schneiderman’s investigation, however, is its misuse of tools designed for another purpose. The Martin Act regulates speech made in connection with transactions in securities. Its subpoena powers are to assist investigations of possible violations. It is very unlikely, no matter what the subpoena turns up, that the attorney general will be able to plausibly argue that Exxon in fact committed such a violation.” (emphasis added)
This abuse of power sets a troubling precedent because “At the extreme, the Martin Act subpoena power could be used to bully corporations into any kind of desired reform under the guise of a securities investigation.”
Fox goes on to explain that the Martin Act only works if a corporation makes an omission that would have been material to securities, which means that what was omitted would have had a substantial impact on the body of available information. Fox notes that the views of Exxon’s scientists were “very much in the public realm” and that they “did not deny the possibility that carbon emissions were causing warming,” only “stressed the scientific uncertainties concerning the extent of carbon’s contribution.” Therefore, Fox notes, “Neither Exxon&...