ESG Enforcement Tracker

Key facts:

The State of Connecticut filed a lawsuit against ExxonMobil for violating its consumer protection laws, the Connecticut Unfair Trade Practices Act (CUPTA). The state alleges that ExxonMobil engaged in a decades long systematic campaign of deception concerning the impact of its fossil fuel products on the climate and a more recent greenwashing campaign designed to improve its image.

Exxon asked the court to dismiss the claims on the grounds that: (i) federal law precludes the claims because climate change involves interstate and international emissions;  the claims do not meet the relevant test under CUTPA; the First Amendment protects its statements, including adverts and public messaging; and the proposed restitution/disgorgement is improper, in accordance with due process, time limits, and statutory limits.

The court rejected ExxonMobil’s arguments, on the basis that the claims focused on deceptive marketing not regulating emissions, the federal law does not preclude state consumer protection claims about misleading advertising, the allegations (if proven) could constitute unfair or deceptive practices under CUPTA, commercial speech receives only limited protections, and the claims for restitution and disgorgement were not legally time barred at this stage. The court noted that the Federal Trade Commission’s (FTC) “Green Guides,” which provide guidance on how consumers interpret environmental claims in marketing, support the plausibility of Connecticut’s allegations. 

This ruling follows the Second Circuit, which previously rejected Exxon’s attempt to move the case to federal court in September 2023, and the state court’s previous rejection of ExxonMobil’s motion to dismiss in July 2024 on the grounds it could not be sued in Connecticut. This means that the lawsuit will now proceed.