California is testing the power of its state laws to hold ExxonMobil (XOM) legally responsible for plastic pollution in the state's air, ground, and waterways.
State Attorney General Rob Bonta filed a lawsuit against the oil giant last month, accusing Exxon of overstating the recyclability of its plastic products. Bonta, who has filed other climate-based claims against Exxon in California's courts, said the plastics case was the "first of its kind."
Exxon countered that claim. Legal experts said the reality is somewhere in the middle.
What's "kind of new," according to University of Texas law professor Linda Mullenix, is Bonta's strategy of weaving together legal theories not typically used in concert to allege environmental harm.
Mullenix said the strategy pairs a claim that Exxon violated California's public nuisance law that prohibits unreasonable interference with the public's right to use property alongside claims that Exxon violated state business laws.
"The oldest public nuisance cases are in the environmental arena," Mullenix said. But more recently plaintiffs lawyers, and now state attorneys general, are testing the claims against a wider set of entities along the supply chain.
"It's all very recent," Mullenix said.
Lauren Kight, Exxon’s media adviser for public and government affairs, said California's lawsuit seeks to blame others for failing to act on the state's pollution problem.
Rows of plastic material await processing at a chemical recycling facility for ExxonMobil in Baytown, Texas. (SERGIO FLORES/AFP via Getty Images)
“Instead of suing us, they could have worked with us to fix the problem and keep plastic out of landfills,” Kight said. Advanced recycling works, she said, adding that Exxon had kept plastic waste out of landfills by processing more than 60 million pounds into usable raw materials.
But Bonta's case also claims Exxon touted its patented recycling technique known as “advanced recycling” as a solution to the plastic waste crisis, knowing that the process could recycle only a "tiny fraction" of the waste it produces.
According to the attorney general, Exxon overstated the potential for its plastic chemical products ethylene, polyethylene, and polypropylene to be recycled. He said the materials, which are part of the formula to create "single-use" containers, are mostly non-recyclable.
Another person familiar with Exxon's legal strategy who requested anonymity said Bonta's claims reach too far because Exxon did not manufacture the containers complained of in the lawsuit. Instead, the representative said, Exxon made only components that others used to create the end products at issue.
This person also said Bonta's case shared similarities with a pending case brought in 2020 by the environmental advocacy group Earth Island targeting Coca-Cola, Pepsi, and Nestle. The case alleges the defendants falsely represented the recyclability of plastic containers.
An Exxon spokesperson said California's lawsuit seeks to blame others for failing to act on the state's pollution problem. (Brandon Bell/Getty Images) ·Brandon Bell via Getty Images
Those cases are partial blueprints for some of the theories set out in the AG’s case, according to lawyers familiar with such legal proceedings, while others are still emerging tactics to address climate concerns.
Sedina Banks, a lawyer in Greenberg Glusker's environmental practice, said her firm has seen an uptick in case filings that go after alleged climate wrongdoers with traditional public nuisance claims as well as the more novel unfair competition claims.
"We anticipate seeing more," Banks said of the trending environmental complaints, adding that the layered claims could bolster plaintiffs' liability claims.
Mullenix said that if plaintiffs are successful in combining business law claims with nuisance claims, it will expand the scope of viable theories that can be used against alleged climate polluters.
Exxon and other oil companies have been fighting to keep climate-based cases out of state courts.
Last Wednesday, a San Francisco Superior Court judge denied the company's request to dismiss another Bonta-led case alleging that Exxon made deceptive public statements about the role of fossil fuels in climate change.
And earlier this week, the US Supreme Court asked the Biden Administration to weigh in on states' jurisdiction over climate-related suits.
Public nuisance claims alone have a track record of successfully leading to multimillion-dollar settlements, in California and elsewhere.
They were at the heart of a 2019 lead paint contamination litigation settlement between California counties and cities and paint producers Sherwin-Williams, ConAgra Grocery Products, and NL Industries.
Bales of recycles plastic containers sit stacked in a warehouse at Recology's Recycle Central on Sept. 24, 2024, in San Francisco, Calif. (Justin Sullivan/Getty Images)
In a major non-environmental dispute, public nuisance allegations led to the $808 million settlement of hundreds of state and local government claims alleging that US opioid manufacturers and distributors caused widespread drug addition and physical harms.
And in November 2023, New York Attorney General Letitia James brought another similar lawsuit alleging that Pepsico and Frito Lay violated state business and public nuisance laws. The case claims the companies' use of plastic packaging contributed to pollution in New York waterways.
Mullenix said Exxon should be expected to argue that it’s too far removed from the end products complained of in Bonta's suit to be legally liable for plastic pollution.
“What the cases are teaching us is, it's probably not going to work,” Mullenix said. In the end, she added, she expects the cases to settle rather than go to trial.
Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed.
