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Exxon Lawsuit Against Activist Shareholders Thrown Out

Exxon Chief Executive Darren Woods said the lawsuit put a spotlight on ‘widespread abuse’ of the shareholder proxy submission process. PHOTO: DAVID SWANSON/REUTERS

A lawsuit Exxon Mobil brought to stop an investor from making climate-related proposals was dismissed, closing what some had seen as a potential legal avenue for companies to take on shareholder activism.

After investment firm Arjuna Capital promised to never again hit Exxon with a greenhouse gas-related resolution, the court couldn’t weigh in further, U.S. District Judge Mark Pittman said in a decision released after a hearing Monday in Fort Worth, Texas. Courts can’t weigh in on a legal question without a live controversy in play, Pittman said, dismissing the case as moot.

Pittman’s decision ends the lawsuit, brought by Exxon in January, without a ruling on the law on shareholder proposals, which in recent years have steadily risen in number. Many come from investors with small stakes who want to push companies on hot-button cultural and environmental issues.

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