Former Exxon Mobil CEO Rex Tillerson, who left the post for a stint as President Trump's secretary of state, is expected to testify on Wednesday during a trial on claims that the corporation misled shareholders about the costs of climate change regulations.
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The Attorney General's Office says the oil and gas behemoth didn't share one of its calculations of the future costs of the rules, causing shareholders to overvalue the company's stock by $476 million to $1.6 billion, The Wall Street Journal reported. The trial began last week.
Exxon Mobil, however, told FOX Business that it met its responsibility to shareholders and argued that the case is politically motivated.
TickerSecurityLastChangeChange %XOMEXXON MOBIL CORPORATION68.44-0.20-0.29%
Exxon Mobil lawyer Theodore Wells said in his opening statement that under Tillerson, the company had a "robust system" to manage the costs of climate change, Reuters reported.
The state's case hangs on the Martin Act, a New York law that has been used to crack down on misleading information provided to shareholders. Passed in 1921, the law doesn't require the state to prove fraudulent intent by the corporation or that any investor was actually misled.
FILE – Secretary of State Rex Tillerson speaks about Qatar at the State Department in Washington, Friday June 9, 2017. (AP Photo/Jacquelyn Martin)
The Lawsuit Reform Alliance of New York and its executive director Tom Stebbins have criticized the case.
"This case has been a farce since disgraced former-New York Attorney General Eric Schneiderman politicized the state's powerful Martin Act and launched his first probe of Exxon Mobil in 2015," Stebbins said in a statement.
"Schneiderman's office worked in concert with private special interests to tarnish the company – grabbing headlines and to boost his national image," Stebbins continued. "Now, nearly four years later, at the cost of countless taxpayer-funded court resources, this dubious lawsuit has finally gone to trial. I hope Justice Ostrager sees this action for what it truly is: a political abuse of a statute that is dangerous when wielded based on the ideological whims of the holder of the Office of the New York State Attorney General."
Tillerson was CEO of the company from 2006 to 2017.