Exxon Asks Judge to Throw Out Climate-Change Class Action

September 27, 2017
By David Lee

DALLAS (CN) – ExxonMobil and U.S. Secretary of State Rex Tillerson asked a Dallas federal judge on Tuesday to dismiss a shareholder class action against them, arguing investors are piggybacking claims by several blue-state attorneys general that the oil giant concealed what it knew about climate change.

The Irving-based oil company says the plaintiffs in the case are seeking a “free ride on the soiled coattails” of New York Attorney General Eric Schneiderman’s investigation into its knowledge of climate change and global warming.

In a 32-page motion to dismiss, ExxonMobil accuses the investors of copying “the baseless insinuations and irresponsible allegations” by Schneiderman’s office.

“None of that recycled material is entitled to any weight,” the motion to dismiss with prejudice states. “After years of transparent publicity seeking, pandering to well-financed special interests, and repeated shifts in focus, the NYAG has not established any wrongdoing before a court of law. All that has come of the NYAG’s efforts is a stinging rebuke from state attorneys general in twelve other states filed in this court and in a federal court in New York.”

Lead plaintiff Pedro Ramirez sued ExxonMobil and Tillerson in November 2016, claiming violations of the Securities Exchange Act and SEC rules. Tillerson served as ExxonMobil’s chief executive from 2006 to 2016, before he left to join President Donald Trump’s administration.

The lawsuit claims ExxonMobil made “materially false and misleading” public statements when it failed to disclose internal reports that “recognized the environmental risks caused by global warming and climate change.” Ramirez claims the oil giant also used an inaccurate “price of carbon” – the cost of carbon tax or cap-and-trade regulations – to overstate the value of its reserves.

ExxonMobil flatly denies the allegations, retorting that Ramirez is attempting “to manufacture a securities fraud claim out of its baseless allegation that ExxonMobil pulled a ‘bait-and-switch’” when it disclosed it used a proxy cost of carbon up to $80 per ton to account for the potential impact of the government’s climate policies.

“Under plaintiff’s flawed theory, the use of a lower cost figure overstated the value of ExxonMobil’s assets and the amount of its reserves,” the motion states. “But the reality is that ExxonMobil fully disclosed the risks of climate change to its business, and in no way misrepresented the methodologies it used to analyze those risks. There was no shell game.”

ExxonMobil further contends the plaintiffs failed to adequately plead there was any fraudulent intent and that the company repurchased billions of dollars worth of its own stock during the class period and none of the defendants sold their shares.

Ramirez’s lawsuit came on the heels of attorneys general in Massachusetts and the U.S. Virgin Islands launching their own investigations into ExxonMobil’s knowledge of climate change and global warming.

ExxonMobil sued U.S. Virgin Islands Attorney General Claude Walker in Tarrant County Court in April 2016 to block his subpoena for several decades worth of documents, calling it an unconstitutional fishing expedition. Walker agreed to drop the subpoena two months later.
The company also sued Massachusetts Attorney General Maura Healey in Fort Worth federal court in June 2016, seeking to block a similar subpoena. The trial judge ruled four months later that Healey must show there is no political bias in her request.

Several conservative attorneys general have come to ExxonMobil’s aid in the dispute. Texas and 10 other states filed an amicus brief last September in the company’s suit against Healey, saying the investigations were an “unconstitutional use of investigative powers” by liberal authorities.

study by Harvard researchers released last month found that ExxonMobil has knowingly misled the public for nearly 40 years about the dangers of climate change, based on an analysis of company communications.

Company spokesman Scott Silvestri said at the time that the findings are “inaccurate and preposterous.”

From Courthouse News.


Jury Whacks JPMorgan With $4 Billion for Mishandling an Estate

September 27, 2017
By David Lee

DALLAS (CN) – A Dallas County jury Tuesday ordered JPMorgan Chase to pay a whopping $4 billion in damages for mishandling the estate of the former American Airlines executive behind the SABRE airline reservation system.

Max D. Hopper died of a stroke in 2010 and JPMorgan was selected as administrator to split $19 million in assets between his widow and two of Hopper’s children from an earlier marriage.

The widow, Jo N. Hopper, sued the bank in 2011 for breach of fiduciary duty and breach of contract.

The verdict from the six-member jury concluded that JPMorgan failed “to act toward Jo Hopper in the utmost good faith and exercise the most scrupulous honesty” and failed put her interests “above its own and to not use the advantage of its position to gain any benefit for itself” at her expense.

The jury awarded $4 billion in punitive damages and $4.6 million in actual damages.

JPMorgan spokesman Andrew Gray said he is confident the massive verdict will not survive appeal.

“Clearly, the award far exceeds any possible interpretation of Texas tort reform statutes,” Gray said in a statement.

Hopper blasted JPMorgan after the verdict, saying it “horribly mistreated” her and “abused my family and me out of sheer ineptitude and greed.”

She said the verdict would protect others from being mistreated by banks.

“Surviving stage 4 lymphoma cancer was easier than dealing with this bank and its estate administration,” she said in a statement Tuesday evening.

Hopper accused the bank of failing to release interests in the couple’s assets for more than five years, including art, jewelry and her late husband’s collection of 6,700 golf putters and 900 bottles of wine.

“The bank’s incompetence caused more than just unacceptably long timelines; bank representatives failed to meet financial deadlines for the assets under their control. In at least one instance, stock options were allowed to expire,” Hopper’s attorneys with Loewinsohn Flegle in Dallas said in a statement.

“In others, Mrs. Hopper’s wishes to sell certain stock were ignored. The resulting losses, the jury found, resulted in actual damages and mental anguish suffered by Mrs. Hopper. With respect to Mr. Hopper’s adult children, the jury found that they lost potential inheritance in excess of $3 million when the bank chose to pay its lawyers’ legal fees out of the estate account to defend claims against the bank for violating its fiduciary duty.”

Hopper’s attorneys claimed that her chief representative at the bank’s private wealth management unit in Dallas had handled only one other intestate estate during her career.

Hopper’s husband retired as chairman of Sabre Group in 1995, which was at the time a subsidiary of Fort Worth-based American Airlines’ parent company. It  was spun off in 2000 and is now known as Southlake-based Sabre Holdings. It operates the Sabre Global Distribution System, which automates online booking for airlines, hotels, car rental companies, rail providers and tour operators.

From Courthouse News.

Oklahoma Police Shoot to Death a Deaf Latino Man

September 21, 2017
By David Lee

OKLAHOMA CITY (CN) – Oklahoma City police admitted Wednesday that a Hispanic man who was shot to death in front of his home was deaf and could not understand their commands to drop a metal pipe.

Magdiel Sanchez, 35, was shot by one officer with a Taser and by another officer with a gun Tuesday night, police Capt. Bo Mathews told reporters. He acknowledged that neighbors had yelled at police that Sanchez could not hear before he was killed.

“In those very volatile situations where you have a weapon out, you can get what they call tunnel vision, where you can really lock in to just the person that has a weapon that would be the threat against you,” Matthews said at a news conference. “I do not know exactly what the officers were thinking at that point.”

The officer who fired the gun, Sgt. Chris Barnes, is on administrative leave pending investigation. He is an eight-year veteran of the force.

Matthews said an officer was investigating a reported hit-and-run collision at 8:15 p.m. Tuesday and a witness gave the address where the officer found Sanchez on the porch. He said the metal pipe Sanchez held was 2 feet long and had a leather loop on one end for wrapping around a wrist.

Matthews said the officer called for backup and Barnes arrived when Sanchez left the porch to approach the officers. They opened fire at the same time when Sanchez was about 15 feet away.

Matthews said neither officer had a body camera on. He does not know why Barnes used his gun instead of a Taser. He said Sanchez’s father was the suspected driver in the hit-and-run and confirmed to officers that his son was deaf. Sanchez was not in the car and has no known criminal history, Matthews said.

Julio Rayos, Sanchez’s neighbor, told The Oklahoman newspaper that Sanchez was developmentally disabled and did not speak, communicating through hand movements. Rayos speculated that Sanchez became frustrated trying to tell the officers what was going on.

“The guy does movements,” Rayos said. “He don’t speak, he don’t hear, mainly it is hand movements. That’s how he communicates. I believe he was frustrated trying to tell them what was going on.”

Sanchez’s death comes four months after a police officer in Tulsa was acquitted of first-degree manslaughter for shooting an unarmed black motorist who had his hands up and was walking away from her. Betty Shelby was found not guilty of shooting Terence Crutcher, but the jury said she was not “blameless” in his death and questioned whether she had “other options available” to subdue him, rather than kill him.

From Courthouse News.

EEOC Sues Texas Doctor for Religious Discrimination

September 21, 2017
By David Lee

DALLAS (CN) – A Dallas-area medical practice fired four employees for refusing to attend morning Bible discussions or after judging their personal lives, the Equal Employment Opportunity Commission said Wednesday in a federal lawsuit.

The EEOC sued Dr. Tim Shepherd, of Lewisville, on behalf of former employees Almeda Gibson, Courtney Maldonado, Stacy O’Laughlin and Joshua Stoner. It claims Gibson, a Buddhist, made repeated requests for religious accommodation that were denied and that her requests to be excused from the religious portion of the required meetings were ignored.

“These meetings typically began each workday morning with a reading or study of Biblical verses and principles and included a discussion of how the religious principles could be related or applied to the personal lives of the employees,” the 9-page complaint states. “These mandatory meetings were usually led by the business owners, Dr. Timothy Shepherd or his wife Virginia Shepherd.”

The EEOC says Maldonado was “transferred” from clinical supervisor to medical assistant after she told the Shepherds that “she believed it was wrong to require employees to attend meetings at which a specific religion is discussed in such detail.” She was transferred to the new job a week later.

“The day after Ms. Maldonado’s transfer, the Shepherds called a meeting with Ms. Maldonado and the employees she had supervised as clinical supervisor and told the group that Ms. Maldonado had been removed from that position because she was not leading them property, was not following Christ, and was not seeing the Shepherd’s vision,” the complaint states.

“The following week, in early March 2016, Mrs. Shepherd called Ms. Maldonado and another employee into her office and told them both that they needed to be ‘more Godly’ and ‘wash the feet’ of others. Ms. Maldonado was fired on March 9, 2016.”

O’Laughlin was fired one month after Shepherd’s wife told her that being a single mother was “not what God wanted” for her, the complaint states.

Stoner was fired after he refused Ms. Shepherd’s “insistence that he attend premarital counseling because he was living with his girlfriend,” according to the EEOC.

The agency says it filed the lawsuit after trying to reach a pre-suit settlement through conciliation.

“Of course, employers and employees are not required to leave their own religious beliefs at home when they walk through the workplace door,” EEOC Senior Trial Attorney Meaghan L. Shepard said in a statement. “However, the law requires that employers reasonably accommodate requests to be excused from company-sponsored religious activities rather than firing employees who seek such accommodation.”

Shepherd’s office could not be reached for comment after office hours Wednesday.

The EEOC seeks an injunction, back pay, compensatory and punitive damages for religious discrimination and retaliation in violation of Title VII of the Civil Rights Act of 1964.

From Courthouse News.

CitiFinancial to Pay $907K for Seizing Soldiers’ Cars

September 18, 2017
By David Lee

DALLAS (CN) – CitiFinancial Credit has agreed to pay $907,000 to settle claims it illegally repossessed cars belonging to active-duty service members, federal prosecutors said Monday.

The Department of Justice says at least 164 cars were repossessed between 2007 and 2010 in violation of the Servicemembers Civil Relief Act, which shields members of the military from certain civil actions while they are serving.

“During the investigation, the Department learned that CitiFinancial conducted repossessions without court orders even when CitiFinancial had evidence in its own records suggesting that a borrower could be a protected servicemember,” prosecutors said in a statement. “In several cases, loan servicing notes indicated that CitiFinancial was informed that the borrower was in military service or had received orders to report for military service. CitiFinancial, nevertheless, continued repossession efforts and eventually succeeded in repossessing the servicemembers’ vehicles.”

The repossessions took place before CitiFinancial Credit sold its car lending and servicing business to the U.S. subsidiary of Spanish banking giant Banco Santander.

Dallas-based Santander Consumer USA settled similar allegations with federal prosecutors in 2015, agreeing to pay $9.4 million for illegally repossessing over 1,100 between 2008 and 2013.

Prosecutors say a court may delay repossession or require the refund of all or part of prior installments or deposits that a service member has already made.

“The court may also appoint an attorney to represent the servicemember, require the lender to post a bond with the court and issue any other orders it deems necessary to preserve the interests of all parties,” according to an eight-page complaint filed Monday in Dallas federal court. “By failing to obtain court orders before repossessing automobiles owned by protected servicemembers, defendant denied servicemembers their rights to obtain a court’s review of whether their repossessions should be delayed or adjusted to account for their military service.”

Under the terms of the settlement, each member of the military impacted by the repossessions will receive $5,000 and an additional $500 for subsequent lost equity and accrued interest.

CitiFinancial also agreed to have adverse information relating to the repossessions removed from the service members’ credit records.

“The men and women who serve in the armed forces deserve to have us protect their backs while they selflessly protect us,” said John Parker, U.S. Attorney for the Northern District of Texas. “This conduct clearly fell short of that and I’m grateful we were able to repair some of that harm.”

From Courthouse News.

Disgraced Ex-Oklahoma Senator Faces New Sex Charges

September 6, 2017
By David Lee

OKLAHOMA CITY (CN) – A former Oklahoma state senator who quit after being accused of hiring a teenage boy on Craigslist to have sex now faces additional federal child pornography and sex-trafficking charges.

Unsealed Wednesday, an eight-page federal indictment charged Ralph Shortey, R-Oklahoma City, with two counts of transportation of child pornography, one count of production of child pornography and one count of child sex trafficking.

He faces up to 20 years in prison on the first and second counts, up to 30 years on the third and up to life on the fourth. He could also be fined up to $250,000 on each count.

Federal prosecutors claim Shortey used his smartphone and an AOL email account to email a video showing “a man engaging in sexually explicit conduct with a prepubescent girl” to another email address.

The indictment also claims he emailed videos entitled “boy group,” “young boys f[***]ing,” and “young boy sucking c[***]” to another email address.

A married father of four, Shortey, 35, was arrested in March after facing state felony charges of engaging in child prostitution, engaging in prostitution within 1,000 feet of a church, and transporting a minor for prostitution. He was reelected last November to his fourth term.

The Oklahoma Senate unanimously passed a resolution stripping Shortey of his powers and kicked him out of his Capitol office in the days after he was found in a Moore, Okla., hotel room with a teenager. He resigned days later.

Police say the unidentified boy’s father told them his son “has a history of soliciting himself” on Craigslist for sex. They say three officers who showed up at the hotel smelled a strong odor of marijuana in the room and found a bottle of lotion and an open box of condoms.

Federal prosecutors claim Shortey communicated with the boy between March 2016 and March 2017 frequently on the Kik messaging app.

Shortey has not commented on the charges against him since his March arrest.

Cleveland County District Attorney Greg Mashburn said Wednesday that in light of the federal indictment, he will dismiss the state felony case against Shortey.

“I believe this case is best handled in one venue and have every confidence the U.S. Attorney’s Office will prosecute this matter expeditiously,” Mashburn said in a written statement. “It was an honor to work with the various law enforcement agencies involved in this investigation.”

From Courthouse News.

Union Fights Dallas Cowboys Star’s Suspension in Court

September 1, 2017
By David Lee

SHERMAN, Texas (CN) – Dallas Cowboys star running back Ezekiel Elliott and his union sued the National Football League late Thursday, seeking to block a six-game domestic violence suspension they claim is the result of a conspiracy to hide critical information that exonerates him.

The NFL Players Association filed a lawsuit against the league on Elliott’s behalf in Sherman, Texas federal court Thursday evening.

Elliott was suspended for violating the league’s personal conduct policy based on allegations of abuse made by Tiffany Thompson, of Columbus, Ohio, last year.

He appealed the suspension, which was heard this week by league-appointed arbitrator Harold Henderson. Henderson is expected to rule by Tuesday.

Elliott has not been criminally charged for the alleged assault.

The union claims the NFL’s lead investigator, Kia Roberts, recommended no discipline be imposed after interviewing Thompson. The NFLPA and Elliott say Roberts concluded that Thompson “was not credible” and there was “insufficient corroborating evidence of her incredible allegations.”

“The withholding of this critical information from the disciplinary process was a momentous denial of the fundamental fairness required in every arbitration and, of course, does not satisfy  federal labor law’s minimal due process requirements,” the 31-page complaint states. “Further, the fundamental unfairness set forth above was then compounded, multiple times, by denying Elliott the opportunity to confront his accuser and have her sit for cross-examination, a denial which deprived Elliott and the union of the most basic rights of a fundamentally fair procedure, in a proceeding where everyone agreed that the credibility of the accuser and Elliott were essential to resolution.”

The NFLPA claims the arbitrator failed to call NFL Commissioner Roger Goodell – the man who handed down the suspension – to testify, resulting in additional deprivation of fairness to Elliott.

“Without testimony from the commissioner, it was not possible to determine the full impact of the conspiracy, or precisely what the commissioner knew or did not know about his co-lead investigator’s conclusion that there was not sufficient credible evidence to proceed with any discipline under a league personal conduct policy that required ‘credible evidence’ to support the charges in a case like this, where the player has been accused of domestic violence, but law enforcement investigated and rightly declined to bring any charges due to conflicting evidence and inconsistent accounts of the alleged events,” the lawsuit states.

The NFL vehemently denied this allegation Friday morning, saying it is “unequivocally, absolutely false” that Goodell did not know of Roberts’ findings before he suspended Elliott.

“The idea that this was a conspiracy is false,” league spokesman Joe Lockhart said. “The credibility issues were addressed at length in the investigative report. Kia Roberts’ points were made very clearly. The 160-page report included a fulsome description of the credibility problems of both Tiffany Thompson and Ezekiel Elliott.”

Elliott’s attorneys, Frank Salzano and Scott Rosenblum, said they “have witnessed some of the most egregious violations of legal due process” during the league’s investigation into their client.

“Not only did the underlying facts not support the false allegations made against Mr. Elliott, but the process in which they were gathered and adjudicated [was] fundamentally unfair,” the pair said in a written statement. “Mr. Elliott looks forward to being completely vindicated and will continue to explore all other legal options to redress the reputational and monetary harm that he has suffered.”

The union seeks a temporary injunction and the vacating of Henderson’s pending arbitration ruling under Labor Management Relations Act and Federal Arbitration Act. It is represented by Thomas M. Melsheimer with Winston Strawn in Dallas.

From Courthouse News.