Statement of Robert Weissman, President of Public Citizen

Note: Public Citizen late Monday filed a motion to dismiss a defamation lawsuit brought against the organization in August by Murray Energy Corporation and its CEO Robert Murray. The company and CEO sued after Public Citizen ran a short radio advertisement criticizing the company for filing lawsuits to block regulations aimed at protecting public health and addressing climate change. In its motion to dismiss, Public Citizen explains that the lawsuit’s aim is to punish and silence critics. The statements of Public Citizen over which Murray Energy sued are either statements of fact or opinion, both of which are protected under the First Amendment. Further, none of the statements in the ad is about Mr. Murray, so his defamation claim is baseless. The motion is available here (PDF). Public Citizen is represented pro bono in the case by Robert Balin, Alison Schary and Joanna Summerscales of the law firm Davis Wright Tremaine LLP, and Fred Gittes and Jeffrey Vardaro of The Gittes Law Group.

Murray Energy is wrong on the law and wrong in the belief that it can silence consumer groups, reporters and other advocates for climate change solutions.

The groundless lawsuit by Murray Energy is a blatant attempt to silence opposing views – its fourth such lawsuit since July 2012.

The Public Citizen ad made accurate statements and statements of our opinion, based on publicly available sources. As the ad states, Murray Energy has sued to block a rule intended to save lives by limiting the amount of coal dust to which coal miners are exposed. And Murray Energy has sued to block a proposed rule to limit carbon emissions from power plants – a rule intended to reduce the impact of climate change on human health and to prevent premature deaths attributable to carbon emissions.

Murray Energy’s lawsuit against Public Citizen is a desperate act by a member of an industry engaged in a losing battle against the tide of history. For decades, Dirty Energy interests have engaged in a public relations campaign to block action on climate change. As a result, we stand on the brink of climate catastrophe – a cataclysm that threatens tens of millions of lives.

The days when those bullying tactics can succeed are over. The growing public insistence on climate solutions is not going away; neither, unfortunately, is the reality of worsening climate change. As the rule proposed last spring by the U.S. Environmental Protection Agency evidences, policy makers are, belatedly, starting to act. Murray Energy can’t stop that.

Nonetheless, humanity is now in a race against time to take sufficiently bold and comprehensive action to avert catastrophic climate change. If Murray Energy and other companies succeed in slowing action further, we may well fall over the precipice. The consequences would be too terrible to contemplate.

That’s why there is only one reasonable response to a lawsuit intended to scare critics into silence: Defeat the lawsuit in court and use the lawsuit to educate, motivate and activate the American public.

So, our message to Murray Energy: Your lawsuit is only going to help build support for the very solutions to climate change you are trying so hard to prevent.

Read the motion (PDF) to dismiss the lawsuit.

Read Public Citizen’s response to Robert Murray’s statements about the EPA rule.

Read background information about Murray Energy.

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A fossil-fuel-industry front group that calls itself the “60 Plus Association” has released a “study” claiming that the EPA’s proposal to curb carbon pollution, known as the Clean Power Plan, would raise utility costs for seniors. Don’t buy it.

The group relies on a sleight-of-hand to make its claim: It cites only the EPA’s projection that electricity prices will increase under its rule (Clean Power Plan Regulatory Impact Analysis (RIA) Table 3-21) while ignoring the projection, just a few pages later in the very same document, that electricity bills will actually decline. The rule includes efficiency measures that will result in consumers using significantly less power. (RIA Table 3-24). So raw electricity prices will go up a bit, but we will use less power—and pay less overall.

Also, 60 Plus looks only at the agency’s analysis for 2020, rather than its longer-term projections. What happens in the long term is obviously more important. It’s also much more favorable.

Here is a chart that shows projected electricity prices and bills under one of two main scenarios that the EPA analyzes:

Projected Retail Electricity Prices Under EPA’s Option 1, State Compliance Scenario Projected Change in Utility Bills
Cents/kWh Without Rule Cents/kWh Under Rule Percent Change
2020 10.4 11.1 6.5% 3.2%
2025 10.8 11.1 2.9% -5.3%
2030 10.9 11.3 3.1% -8.4%
Source: RIA Tables 3-21, 3-22, 3-23, 3-24.

 

60 Plus points out that electricity prices will rise 6.5 percent in 2020, but it ignores that actual bills will rise by less than half that (3.2 percent) in 2020 and will decline 5.3 percent by 2025 and 8.4 percent by 2030. The numbers are even more favorable under the EPA’s other major scenario, in which states band together and comply in regional groups rather than comply separately. There, bills would fall by 8.7 percent by 2030. (RIA Table 3-24).

Media outlets should ignore this kind of junk from 60 Plus. But at least one local TV station was duped by this release. WDBJ 7 in Virginia not only reported the study, but misreported in just the way 60 Plus wants: by saying it shows that electricity bills will increase under the EPA plan.

Let’s hope no one else picks it up.

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In a move apparently to be more progressive and inclusive, Burger King recently changed its motto from “have it your way” to “be your way.” It’s good the company is trying to be more inclusive, but, the company’s recent decision to merge with Tim Hortons and move its headquarters to Canada which reportedly could score tax reductions for the company, is the opposite of progressive, it’s downright regressive.

By merging with Tim Hortons and reincorporating as a new company in our neighbor to the north, Burger King is deserting its American consumer base, leaving average citizens to pick up the tab for the lost taxes from a profitable U.S. business. A business that will continue to operate in our country, have management and workers here, despite becoming on paper a foreign entity.

The whopper of a tax move is called an “inversion” and it is a way for a company to transfer headquarters on paper to another county with lower tax rates or other policies that reduce the amount of U.S. taxes a corporation pays. Dozens of corporations have done it in recent years, and more have deals currently in the works. Each new company announcing its intent to defect to a foreign tax jurisdiction fans the flames of consumer displeasure.

Recently, America’s largest drugstore chain, Walgreens, made a tactical retreat and dropped plans to reincorporate after merging with a Swiss company in order to invert. After shoppers and activists united in calling on the company to stay true to its U.S. roots and pay its fair share of corporate taxes, Walgreens decided to keep its headquarters (and tax contributions) here in America.

Given all the rightful criticism of American people and press to the problem of inverted companies, it was welcome news when the U.S. Treasury Department announced last week that it is taking some small but positive steps that went part of the way toward addressing inversions. Treasury did that by limiting economic incentives of these inversion deals. The changes to the interpretation of the tax code took away some of the benefits of inversions like ending some types of subsidiary loans, restructuring deals, and cash and property transfers.

Currently, under the tax code, when companies merge and reincorporate in another country but retain 80 percent of their previous shareholders, they are classified as “inverted” under the tax code. That means the inverted company is treated as domestic for tax purposes and is not able to escape paying its fair share of taxes. The new changes from Treasury tighten up the “80 percent rule” by ensuring that companies aren’t able to artificially shrink via dividend payouts or grow by counting passive assets like cash in order to squeak in below the 80% previous shareholders threshold.

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Statement of Robert Weissman, President, Public Citizen

Attorney General Eric Holder’s record was badly blemished by his nearly overwhelming failure to hold corporate criminals accountable.

Holder came into office in the immediate aftermath of a devastating financial crisis caused by an epidemic of corporate crime and wrongdoing. Five years later, he has failed utterly to hold the perpetrators of the crisis accountable. “Too big to jail” became de facto policy, as the U.S. Department of Justice declined to prosecute or even seriously investigate the Wall Street banks or their CEOs who crashed our economy and devastated communities across the country.

Indeed, even when Holder’s Department of Justice uncovered evidence of large financial institutions such as HSBC engaging in money laundering on behalf of narcotraffickers and countries the United States considers terrorists, it failed to criminally prosecute the corporations – let alone the responsible executives. Only under public pressure did the department change its stance and begin exacting criminal pleas, as in the case of BNP Paribas.

Of course, there have been important exceptions to the corporate crime-coddling at the Department of Justice, notably in the case of BP, where Holder’s department deserves plaudits for its effort to impose meaningful sanctions on the company whose recklessness led to the death of 11 workers and an environmental disaster.

As President Obama considers candidates to replace Eric Holder, he should apply this litmus test: Will the new attorney general hold accountable the institutions and individuals on Wall Street who devastated Main Street? Will the new attorney general abandon the “too big to jail” prosecution policy and move toward a regime of transparency and real penalties for criminal mega-banks?

It’s been a big week for climate change. Here’s a roundup of the news in case you’ve had trouble keeping up:

Yesterday, UN Secretary General Ban Ki-moon hosted a UN Summit on climate change in New York, convening leaders in government, business, finance and civil society to “galvanize and catalyze climate action.” The idea was that world leaders would announce major new initiatives. To some extent it was a success, although it didn’t prompt major announcements from the U.S. or China, the 800-pound carbon emitters in the room.

President Barack Obama spoke at the summit, urging aggressive action, particularly from China. He announced an executive order requiring federal agencies to “factor climate resilience” into foreign aid and development decisions. Regarding major actions on climate change, he simply referred to the EPA’s proposed rule to curb carbon emissions 30 percent from 2005 levels by 2030, which Public Citizen strongly supports and seeks to strengthen. He also noted that the U.S. is on target to meet its pledge to cut emissions 17 percent from 2005 levels by 2020. For its part, China said it would try to peak its carbon emissions “as early as possible.”

Just last week, the U.S. made two other announcements:

  • The Department of Energy proposed a rule that would require hotels to use more efficient heating and cooling equipment. The rule could reduce carbon emissions by 11.29 metric tons, which is like taking 2.3 million cars off the road. It’s also another example of how climate change policy makes good economic sense. DOE estimates that the rule would cost businesses up to $9.39 million per year but save them up to $13.1 million per in energy costs. Those benefits are in addition to $7.2 million annual savings from reduced carbon emissions.
  • The White House announced that it secured voluntary commitments from some large chemical manufacturers and retailers to phase out hydrofluorocarbons, or HFCs, more quickly than the law requires. This is an important development, as HFCs are 10,000 times more potent than carbon dioxide in causing climate change.

There were several other important developments around the summit as well:

  • The Global Commission on the Economy and Climate issued a blockbuster report concluding that stopping climate change might not cost us anything. The crux of the analysis: Over the next 15 years, we’ll spend $90 trillion on new infrastructure world-wide anyway. Ambitious measures to combat climate change would add just 5% to that figure. When you factor in the benefits – like better public health from reduce air pollution – the measures will likely be net-positive for the economy.
  • New York City announced a major plan to increase the energy efficiency of buildings, which will set the city on target to curb its greenhouse gas emissions by 80 percent by 2050 from 2005 levels. That’s the reduction that the UN has said industrialized countries must make to prevent catastrophic climate change.
  • The World Bank announced that 73 countries, 22 states, and over 1,000 businesses have pledged support for putting a price on carbon. The list includes the European Union and China, but not the U.S. It doesn’t provide any specifics on what anyone will do. Nor is it legally binding. But it’s a start.
  • The Rockefeller Brothers Fund, originally launched with Standard Oil money, led 180 institutions and hundreds of individuals in announcing that they will divest $50 billion in assets from fossil fuels.
  • Over 340 institutional investors worldwide that control at least $34 trillion in assets called on governments to put a price on carbon.
  • Google announced that it would sever ties with the American Legislative Exchange Council (ALEC) because of the group’s opposition to sound climate change policy. “Everyone understands climate change is occurring and the people who oppose it are really hurting our children and our grandchildren and making the world a much worse place,” Google Executive Chairman Eric Schmidt said. “And so we should not be aligned with such people — they’re just, they’re just literally lying.” Public Citizen pointed out that by the same reasoning, Google should leave the U.S. Chamber of Commerce as well. Facebook soon announced that it too was leaving ALEC.

Ahead of the UN Summit, over 300,000 – and possibly as many as 400,000 – people joined the People’s Climate March in New York City. It was the largest climate demonstration in history, shattering the organizers’ goal of 100,000 participants. In addition to the march in New York, activists held 2,808 other events in 166 countries.

We also learned some bad news last week:

  • The Global Carbon Project reported that greenhouse emissions grew by 2.3 percent in 2013, demonstrating that we still have a long way to go in fighting climate change. We need to start moving in the opposite direction, quickly.
  • This past August was the hottest in recorded history. May and June also set new records, and April tied the record set in 2010.

So we have our work cut out for us. But we can solve this problem – and evidence is mounting that stopping climate change will benefit consumers and the economy, not hurt us. We just need to convince our governments to act. You can start by telling the EPA that you support its proposal to curb carbon pollution from existing power plants.

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