Reports of Pay-to-Play Scheme Complicate New York AG’s Anti-Exxon Probe

As the U.S. House Science Committee prepares for a major hearing tomorrow on Congressional oversight of state attorneys general involved in the #ExxonKnew campaign, the New York AG at the center of the controversy is now facing pay-to-play accusations.

As the New York Post reported this week, New York Attorney General Eric Scheniderman may have used his investigation of ExxonMobil as a hook to secure campaign funding from billionaire environmental activist Tom Steyer for his upcoming run for governor. As the Post puts it,

When state Attorney General Eric Schneiderman took on ExxonMobil over climate change last year, it seemed like an odd global crusade for a local politician.

Perhaps he was drilling for campaign cash, critics now contend after The Post obtained an e-mail that appears to show the state’s top cop was seeking a tree-hugging billionaire’s help to finance a run for governor in 2018.

In March 2016, four months after announcing the Exxon probe, the Democratic AG tried to arrange a phone meeting with hedge-fund mogul Tom Steyer, an environmental activist and Exxon enemy.

Eric Schneiderman would like to have a call with Tom regarding support for his race for governor . . . regarding Exxon case,” reads the March 10 e-mail. (emphasis added)

Steyer’s group, NextGen Climate, has publically lobbied state attorneys general to join Schneiderman’s political climate crusade against ExxonMobil. On April 21, 2016, NextGen hosted and funded an ultimately unsuccessful rally to encourage New Hampshire Attorney General Joseph Foster to launch his own investigation into Exxon.

When this revelation came to light, the New York Republican State Committee called it a “pay to play” scheme, and called for a federal investigation:

“Mr. Schneiderman has established a long and disturbing pattern of abusing the power of his office for political gain. Both of these cases indicate sufficient evidence to warrant an independent investigation by US Attorney Preet Bharara. Mr. Schneiderman must also comply with a subpoena issued by the U.S. House Science Committee requesting information about his ExxonMobil investigations amid allegations that the investigation is politically motivated. To date, he has chosen to defy the subpoena, leaving many troubling questions unanswered. As the highest ranking law enforcement officer in the state, the Attorney General must be above politics and until this matter is investigated by an independent body, there will be an indelible stain on the office.” (emphasis added)

Former New York Attorney General Dennis Vacco, who has written that “ExxonMobil is nothing like” the tobacco companies he sued, told the New York Post that Schneiderman’s conflicts may extend beyond an alliance with Tom Steyer:

“It all smacks of politics…What’s unsettling to me about this probe is that many of Attorney General Schneiderman’s supporters are investors in alternative-energy companies and enemies of Exxon.” (emphasis added)

Schneiderman has received nearly $264,000 in campaign donations from a variety of interests involved in the #ExxonKnew campaign, including members of the Rockefeller family; lawyers from Cohen Milstein, the law firm that issued the now retracted subpoena from the U.S. Virgin Islands Attorney General’s Office; and George Soros’ family, which has poured money into many of the foundations that fund the environmental groups behind the campaign. Soros’ Open Society Foundations funds the Rockefeller Family Fund, the Union of Concerned Scientists and the Columbia School of Journalism Energy and Environment Reporting Fellowship, which helped spark Schneiderman’s investigation last year with a series of anti-Exxon articles.

The New York Attorney General has tried to keep his correspondence under wraps, even sending a letter today to Rep. Lamar Smith (R-Tex.), Chairman of the House Science Committee, defending his refusal to turn over documents required by transparency laws.

But as many legal experts have noted, Schneiderman’s refusal is on shaky legal ground.  According to Elizabeth Price Foley, a constitutional law professor at Florida International University College of Law, who will be testifying at the House Science Committee hearing tomorrow,

“New York Attorney General Eric Schneiderman claimed, in a July 13 letter to Mr. Smith, that the committee was ‘courting constitutional conflict’ by failing to show ‘a due respect for federalism.’ Massachusetts Attorney General Maura Healey, in a similar letter dated July 26, asserted that the subpoenas are ‘unconstitutional’ because they are ‘an affront to states’ rights.’

This view is utterly wrong. Federalism is a critical component of the constitutional architecture. The federal government exercises only limited and enumerated powers, and the states, under the Tenth Amendment, possess all other powers ‘not delegated to the United States.’ But when the federal government acts within its delegated powers, it is entitled to supremacy over the states.

The Supreme Court has long recognized Congress’s power to investigate any matter within its legislative or oversight competence. With that comes a corresponding power to enforce its inquiries. The justices wrote in Barenblatt v. U.S. (1959) that the scope of Congress’s power of inquiry ‘is as penetrating and far-reaching as the potential power to enact and appropriate under the Constitution.’” (emphasis added)

Foley also notes, “Further, Congress has ample authority to investigate and sanction violations of First Amendment rights that are committed by state officials.”

Foley is only the latest in a long string of legal experts who have criticized Schneiderman’s actions regarding #ExxonKnew. For example, Columbia Law Professor Merritt B. Fox has said,

“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)

Philip Hamburger, also a law professor at Columbia University, recently wrote that New York’s investigation of Exxon is “a prosecutorial threat to liberty and due process.”

Harvey Silverglate, an attorney and former Board president of the Massachusetts chapter of the American Civil Liberties Union, said recently that the Exxon investigation is “pure harassment.” He continued, “It is outrageous for any law enforcement official to be seeking to win this battle for minds by flexing law enforcement muscle and trying to shut up the other side.”

Brooklyn Law School professor James Fanto told Bloomberg News that the investigation seems “completely politically motivated.” Former U.S. attorney Matthew Whitaker recently called the investigations “unconstitutional and unethical.”

Tristan Brown, a lawyer and assistant professor of Energy Resource Economics at State University of New York who even admitted that he “empathizes” with the #ExxonKnew campaign, noted that the AGs launching climate investigations are essentially changing the definition of what it means to commit fraud, which sets a “dangerous” precedent.

With the recent revelations about the pay-to-play schemes and the hundreds of thousands in campaign donations – and with just about every legal expert saying he doesn’t have a case – what else is Schneiderman trying to hide?

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