City of New York v. Exxon Mobil Corp., 2026 WL 3023932, Appeal
No. 6583, — N.Y.S.3d —- (App. Div. Oct. 8, 2026)

False advertising claims against fossil fuel companies for
contributing to climate change are hard to win. The City alleged that
defendants engaged in “deceptive … trade practice[s]” proscribed by the
City’s Consumer Protection Law (CPL) “by misrepresenting the purported
environmental benefits of using their fossil fuel products” (“product
greenwashing”) and “by creating a misleading impression of the role of
renewables [i.e., renewable energy] in their businesses” (“corporate
greenwashing”). The appellate court affirmed the dismissal
of the claims.

Product greenwashing: The alleged deceptiveness came from
failure to disclose that fossil fuels contribute to climate change, but the
connection was already public information. If, as alleged, consumers care about
fossil fuels’ contribution to climate change, they couldn’t be duped by failure
to disclose. This was true even if the court didn’t apply the reasonable
consumer standard but rather the older standard: the effect the statement would
have upon a consumer falling within the ranks of “the ignorant, the unthinking
and the credulous who, in making purchases, do not stop to analyze but are
governed by appearances and general impressions.” “Because the statements at
issue disclose that the improved products are gasoline, even unsophisticated
consumers – given the City’s foundational assumption of near-universal
understanding of the link between gasoline use and climate change – would
necessarily understand that use of the improved products contributes to climate
change.” Comparative statements that improved products would produce fewer emissions
than other gasoline products could not “lead even an incautious consumer to
understand defendants to be representing that the environmental impact of use
of the new products to power private vehicles would be comparable to the impact
of taking public transportation, bicycling, walking, or using electric or
hybrid cars.” Nor were defendants required to quantify the reduction in
emissions in their ads. “Nor has the City come forward with evidence that the
reduction in emissions made possible by the gasoline products at issue is so
minute, as compared to other gasolines, as to be legally insignificant.”

As to the corporate greenwashing claim, the court concluded
that the complaint did not sufficiently allege that the statements were “made
in connection with the sale” or “offering for sale” of “consumer goods or
services” “because none of the clean alternative energy products referenced in
the statements were sold to consumers, either in New York or anywhere else.”

Although the CPL bans conduct that “has the capacity,
tendency or effect of directly or indirectly deceiving or misleading consumers,”
“[e]ven an allegation that a statement has the tendency to indirectly deceive a
consumer must still be ‘made in connection with the sale’ of a consumer good or
services” to fall within the scope of the prohibition.

from Blogger https://tushnet.blogspot.com/2026/10/dismissal-of-nycs-consumer-protection.html