From: Samantha Dravis Subjcctl Follow Up from CalI All, Thanks for getting on the call today. Attachcd is a draft of the letter we discussed on the call. Please respond to this email and let me know if your boss will sign on. General Pruitt is very supportive, as are others. Always, Samantha DRAFT - DRAFT- DRAFT Dear Colleagues, AprilXX, 2016 Slxteen state Attorneys General recently held a press conference under the banner of "AGs United for Clean Power." The media event highlighted an lnvestlgation into "whether fossll fuel companles mlsled lnuestors and the public on the impact of climate change on their businesses,"l We think this effort by our colleagues to police the global warming debate through the power of the subpoena is a grave mistake, We all understand the need for a heahhy ênvlronment, but we represent a wlde range of vlewpoints regardlng the extent to which man contrlbutes to cllmate change and the costs ând benefits of any proposed flx, Neveftheless, we agree on et least one thing-thls ls not a question for the courts. Uslng law enforcement authorlty to resolve a public policy debate undermines the trust invested in our offices and threatens free speech. We are concerned that our colleague's lnvestlgåtion undermlnes the trust the people have invested in Attorneys General to investigate fraud, lnvestigatory subpoenas were'ssued to at least one compeny and one non-proflt believed to have made statements mlnimizing the rlsks of cllmate change.2 At the press conference, one of our colleagues noted that "[w]e are pußulng this as we would any other fraud matter."3 We routlnely lnvestigate fraud, and have done so with many of the states present at the press conference. But this lnvestlgatlon ls far from routlne. We are unâwefe of any fraud case combiníng the following three characteristics: 1) the investlgatlon targets a particular type of market participant; 2) the Attorneys Genêrel identify themselves wlth the competitors of thelr lnvestlgatlve targets; ând 3) the investigation implicates an ongolng public policy debate. Flrst, this fraud lnvest¡gat¡on târgets only 'fossil fuel companies" and only statements m¡nimizing climate change rlsks.4 lf it ls posslble to mlnimlze the risks of clìmate change, then the same goes for exaggerâtion, lf minimizatlon is fraud, exaggeration ls fraud. Some have lndicated that Exxon Mobil's securit¡es disclosures regarding climate change may be lnadequate,s We do not know the ãccuracy of these charges. We do know that Exxon Mobll dlscloses climate change and lts posslble lmpllcatlons as a buslness rlsk. See Exxon Mobil Corporation SEC Form 10-k, FY 2014 (lístlng "Climate change and greenhouse ßäs restrlctlons" äs an item 1A risk factor), lf Exxon's dlsclosure is deflclent, 1 Press Release, New York State Attorney General, A.G, Schneidermon, Former Vlce P¡esident Al Gore And A Coølition Of Attorneys Generol From Aüoss The Country Announce HistorÍc Stote-Bosed Elfort To Combat Cl¡mdte Change (March 29, 2016) (available at http://www.ag.ny,gov/press+elease/ag-schnelderman-former-vice' presid ent-al-gore-and-coa lltlon-attorneys-Benera l-across), See, e,g., Attorney General Schnelderman, Press Conference, AGs United For Clean Power (March 29, 2016) (confirming subpoena to ExxonMobil) {vldeo avallable at http;,íwww.ag,ny,gov/press-release/ag-schneiderman' former.vice-president-algore-and-coa litlon-attorneys-general-acrossl; Subpoena to Competltlve Enterprlse lnstitute, United Støtes Virgin lslonds, Ofl¡ce of the Attorney Generol v, ExxonMobll Oll Corp,, Case No, 16-002469, ' Super¡or Court of the Distr¡ct of Columbia (Aprll 4, 2016), t Attorney General Schnelderman, Press Conference, AGs United For Clean Power, supro nohe2. a lee generolly Press Release, New York St€te Altorney General, supro note 1; Press Conference, AGs Uníted Clean Power, sup¡o note 2, t See, e.g,, Attorney General Healey, Press Conference, AGs United For Clean Power, supro nole2. tor DRAFT-DRAFT-DRAFT what of the failure of renewable energy companies to llst cllmate change as a risk? See, e.g., SolarClty Corporation SEC Form 10-k, FY 2014 (omitting from item 1A rlsk factors any mention of climate change or global warming). lf climate change is perceived to be slowing or becoming less of a risk, many "clean energy" companies may become less valuable and some may be altogether worthless. Therefore, any fraud theory requiring more disclosure of Exxon would surely requlre more disclosure by "clean eneryy'' companles, Similarly, it has been asserted that "fossil fuelcompanles" may have funded non-profits who minímized the risks of climate change.6 Does anyone doubt that "clean energy" companies have funded non-proflts who exaggerated the risks of climate change? Under the stated theory for fraud, consumers and investors could suffer harm from misstatements by all energy-market part¡cipants and the nonproflts they support. Yet only companies and non-proflts allegedþ espousing a particular viewpoint have been chosen for ¡nvestigation. Second, the Attorneys General have taken the unusual step of aligning themselves with the competltors of their investigative targets. The press conference was titled, 'îGs United for Clean Power," apparently to contrast wlth the power generated by the investlgative targets.T One of our colleagues emphasized that she looked forward to worklng with those at the press conference to "advocate for a comprehensive portfolio of renewable energy sources."s Furthermore, the media event featured a senior partner of a venture capital flrm that invests ln renewable en€rgy companies.s lf the focus is fraud, such alignment by law enforcement sends the dangerous signal that companies in certaln segments of the energy market need not worry about their mlsrepresentâtions. For example, though some of us may have investigated dlesel emissions, we have not launched our lnvestigations wlth other auto companies present or ldentlfied ourselves as "AGs Unlted for Dlesel Alternatlves." lmplying a safe harbor for the "Clean Power" energy segment, whlch some estimate at S2O0 billlon, or approximately the size of the pharmaceutical industry, ls a dangerous practlce,l0 Third, this investigation inescapably implicates a public pollcy debate and ralses substantlal Flrst Amendment concerns. As our colleagues must know, a vigorous debate exlsts in this country regardlng the risks of climate change and the appropriate fesponse to those risks. Both sides are well-funded and sophistlcated public policy part¡cipants. Whatever our country's response, it will affect people, comrnunities, and businesses that all have a right to partlcipate in thls debate. Act¡ons indieating that ' see, e,g,, Attorney General Schneiderman, Press Conference, AGs United For Clean power, suprø nole 2, generally Press Release, New York State Attorney General, supro note 1i press Conference, AGs United For Clean Power, supra note 2, s Press Release, New York State Attorney General, supro note 1 (quotlng Attorney General Madigan), e,S¿e-Prcss Release, Nerv York Srate Attomey Gøreral, suprc noto I (noting presence of Vice presidcnt Gore); press Conference, AGs United For Clean Power, supra note 2 (including romarkJby Vice presidont Gore; press Relcass, Kleiner Perkins C¡ufield & Byers, Al Gore Joins KPCB as Paflner and John Doørr Join¡ Generation,s Advisory Soarrl (Novembet 12,2007) (available at httpsr//www.generationim,conr/media/pdf.generation-kpcb-12-l l-07.;d0; Klsiner Pcrkins Caufreld & Byers public website, available at http://www,kpcb.iomTpartner/al-iore (confirming President Gore's present status as a "senior partner,,). Y^lce See, e'g.,lnforrnatlonal Report, Environmental Defense Fund, Climote (2015), at 2 {notfng ,,U.S. clean energy 'o market grew,., to 5200 billlon," in 2014) (avatlable at httpsr//www,edf.orglsites/defautVfiles/AR2O1S/EDF_ARzO15_climate,pdf see ), DRAFT- DRAFT- DRAFT one side of the climäte chânge debate should feâr prosecutlon chills speech in violation of a formerly blpartisan Flrst Amendment consensus. As expressed by Justice Brandels, lt has been a foundational principle that when faced with "danger flowing from speech ... the remedy to be applied is more speech, Here, notenforcedsilence," Whitneyv.Cotiforniø,274U,S.357,377(1927)(Brandels,J.,concurring). the remedy chosen ls sllence through threat ofsubpoena, Thls threat d¡storts the debate and impoverlshes consumers and the general public who may wish to better educate themselves by hearing and evaluating both sides. Once the government beglns policing viewpoints, two solutions exlst, The flrst solutlon ls to police a ll viewpoints equally. Another group of Attorneys General could use the precedent estâblished Powe/'to lnvestigate fraudulent statements assoclated with competing lnterests, The subpoenas currently directêd at some market partic¡pânts could be met w¡th a barrage of subpoenas directed at other market participants. No doubt a reasonable suspicion exists regarding a number of statements relating to thê r¡sks of climate change. Even ln the press conference, a senlor partner at Kleiner Perkins Caufield & Byers ("Kleiner Perkins") identifled "man-made global warming pollutlon" as "the reason" for 2015 temperatures, the spread of Zika, flooding in Loulslana and Arkansas, Super Storrn Sandy, and Super Typhoon Halyon.ll Sorne evidence may support these statêments, Other evidence may refute them, Do these stätements lncrease the value of clean energy investments offered for sale by Kleiner Perkins? Should these stetements Justlfy an lnvestigation into all contrlbutlons to environmental non-profits by Kleiner Perkins' partners? Should these guestlons be settled by our state by the "AGs Unlted for Clean courts under penalty of RICO charges? Mây ¡t never be. As Justlce Jackson noted, our "forefathers did not trust any Bovernment to sepaÌate the true from the false for us." Thomos v, Collins,323 U.S. 516, 545 (1945), We wrlte to urge our colleagues to choose the second, and far superior, solutlon, Stop policing viewpoints. Slncerely, lrVice Presldent Gore, Press Conference, AGs United For Clean Power, supto note 2,