By Dave Anderson
Christopher Wray, President Trump’s nominee for FBI director, advised corporate clients on how to avoid “being in the crosshairs” of law enforcement at a 2015 legal forum where investigations by state attorneys general into whether ExxonMobil misled investors and the public about climate change were a topline issue.
Wray’s law firm later pitched clients on its ability to help corporations “vigorously contest” such investigations in response to the 2016 launch of a coalition of 17 state attorneys general aimed at pursuing similar legal efforts around climate change. The firm’s clients have included ExxonMobil and other powerful fossil fuel interests.
— EcoWatch (@EcoWatch) May 10, 2017
First, some quick background on the issues at play, followed by some details on the involvement of Wray and his law firm.
Wray once led federal corporate fraud investigations, but then he switched sides
President Trump described his new nominee for FBI director as “a man of impeccable credentials” in a tweet. Wray’s credentials include a 2003-2005 stint as assistant attorney general for the U.S. Department of Justice, where he oversaw corporate fraud investigations, helped to take down Enron and contributed to national security efforts after 9/11.
After Wray left the Department of Justice in 2005, he switched sides and joined the corporate law firm King & Spalding, which has consistently ranked as a “White Collar Group of the Year.” He’s since defended big corporations against investigations by U.S. attorneys general offices around the country.
Wray’s law firm has defended powerful fossil fuel interests in climate change litigation
King & Spalding successfully defended Chevron in Native Village of Kalina v. ExxonMobil, a case where a community of Alaska Natives sought compensation for the cost of relocating their coastal village due to flooding and erosion caused by climate change. The community and others like it still remain stranded in the path of rising waters, without the financial resources necessary to relocate once again.
DesmogBlog has previously reported on some of the firm’s broader other clients in the fossil fuel industry, which have included ConocoPhillips, Marathon Oil, Occidental Petroleum, Peabody Energy and Shell. Other clients have included ExxonMobil and the Russian oil companies Gazprom and Rosneft.
The firm’s client list is of interest given the current scrutiny of the Trump administration’s ties to Russia. For example, Sec. of State Rex Tillerson established a long-term relationship with Rosneft while CEO of ExxonMobil. In addition, some members of the U.S. House of Representatives and Senate have called on the Department of Justice to investigate ExxonMobil’s record of deception on climate change based on the same authority it previously used to take on the tobacco industry.
— EcoWatch (@EcoWatch) May 30, 2017
The FBI’s role in the ExxonMobil climate change investigations
In 2016, a letter from the Department of Justice informed members of Congress that it had forwarded their request for a federal investigation into whether ExxonMobil may have violated the law by “failing to disclose truthful information to investors and the public regarding climate science” to the FBI.
“The FBI will determine whether an investigation is warranted,” the 2016 letter from DOJ said.
More than half a million Americans also petitioned the Department of Justice to investigate the oil and gas producer. The calls came after it was revealed that ExxonMobil knew about the possible risks that carbon dioxide emissions resulting from use of its products—fossil fuels—posed to the earth’s climate, long before it spearheaded a decades long campaign of climate denial.
The FBI has been silent on the issue since then, and prospects of a federal investigation into ExxonMobil’s climate deception dimmed when Trump chose Sen. Jeff Sessions to serve as U.S. attorney general. While in the Senate, Sessions joined a letter to the Department of Justice that opposed such an investigation.
Wray offered clients legal advice at a 2015 forum on the ExxonMobil investigations
The December 2015 forum, “From Climate Change to Anti-Corruption: The Energy Sector in the Crosshairs of Government Enforcement,” that was hosted by King & Spalding was largely framed as a response to these investigations.
Wray topped the list of speakers , which also included several other attorneys from his firm.
A January of 2016 Client Alert, “State Attorneys General Investigations and Enforcement: What to Expect in 2016,” sent by King & Spalding confirms that the forum:
“…discussed New York Attorney General Eric Schneiderman’s investigation into ExxonMobil’s securities disclosures and their connection to climate change issues, among other recent energy-related investigations.”
Wray’s advice at the December 2015 forum was quoted in the same Client Alert that King & Spalding sent out the following month:
“When you see a competitor announce in their disclosure that they’ve got an investigation, whether it’s with a state AG, the SEC, the Justice Department or all of the above, immediately start trying to figure out as much as you can about what they are dealing with and start asking yourself questions internally: Is there any chance at all we could have a problem like that since they’re in the same industry in the same place? Is there something we ought to do … so that we don’t end up being in the crosshairs?”
“In this way, companies can identify areas where the government is likely to investigate and proactively move to improve and reinforce compliance in those critical areas,” the client alert then concluded, based on Wray’s remarks.
But Wray’s law firm later offered clients the ability to “vigorously contest” such investigations
Spalding & King soon followed up with an April 2016 Client Alert, “State AGs Announce Climate Change Investigations,” that closed with a sales pitch:
“King & Spalding has been at the forefront in representing clients who have found themselves the targets of state AG investigations or claims for almost 30 years. Our experience with state AG investigations began in the 1980s with our representation of Brown and Williamson Tobacco Company and continues through to today representing clients in many industries, including energy companies. King & Spalding’s State Attorneys General Practice is jointly led by our government investigations and public policy groups, and is supported by our strategic alliance with former Wisconsin Attorney General J.B. Van Hollen.
We always do what we can to help clients avoid or minimize the impact of state Attorneys General investigations and litigation whenever possible, but we are not afraid to vigorously contest those investigations when appropriate or to try cases when necessary. We are also adept at engaging with the media directly or in coordination with communications personnel and/or consultants.”
The April 2016 client alert came from King & Spalding’s Special Matters and Government Investigations Practice Group, which Wray had chaired since 2006. Wray was not explicitly named in the April client alert, as he was named in the earlier January alert.
King & Spalding’s April 2016 alert came shortly after the launch of the coalition of 17 state attorneys general that significantly raised the stakes for ExxonMobil.
“The participating states are exploring working together on key climate change-related initiatives, such as ongoing and potential investigations into whether fossil fuel companies misled investors and the public on the impact of climate change on their businesses,” according to a press release from Schneiderman’s office.
King & Spalding’s April 2016 client alert also questioned the motives of these state attorneys general. It cited information obtained through a public records request submitted to the Vermont attorney general’s office by the Energy and Environment Legal Institute (E&E Legal) in an attempt to stir up political controversy around the investigations. E&E Legal is a climate denial outfit with ties to the Trump administration and is known for its use of public records requests to harass real climate scientists.
In 2015, E&E Legal received funding from coal producer Peabody Energy. That same year, the Peabody Energy reached a settled with Schneiderman after an investigation into the coal company’s “misleading statements” to investors on climate change.
Wray is not the first Trump nominee to have weighed in on the issue
Corporate attorney Jay Clayton worked for a law firm that advised clients to comply with guidance on climate change disclosure from the Security Exchange Commission (SEC) after Schneiderman announced his investigation of ExxonMobil’s disclosures. News broke that the SEC had launched a related investigation into ExxonMobil’s climate accounting practices in September of 2016.
Clayton is now serving in the Trump administration as chairman of the SEC. During his Senate confirmation hearing, Clayton advised that corporations should continue to be “mindful” of the SEC’s guidance on climate change disclosure:
Similar questions could arise at Wray’s confirmation hearing, though those are likely to be dominated by questions about the FBI’s ongoing investigation into Russian influence over the 2016 election.
State attorneys general will continue to lead the investigations into ExxonMobil’s record on climate change
There is no reason to believe that any real federal investigation of ExxonMobil’s climate change disclosures, or those of other companies, will occur while Trump is in the White House. The Trump administration has, with few exceptions, generally followed the fossil fuel industry’s lead by rolling back key U.S. climate change policies that have long been opposed by ExxonMobil and its political allies.
State attorneys general will continue to lead the charge on holding companies like ExxonMobil accountable when they deceive investors and the public about climate change risks, and recent trends indicate forward thinking shareholders will do the same.