Exxon Mobil v. Healey

28 F.4th 383

• Court: Court of Appeals for the Second Circuit
• Decided: March 15, 2022
• Docket: 18-1170
• Status: Published

Opinion

18-1170 Exxon Mobil v. Healey

United States Court of Appeals For the Second Circuit

August Term 2019

Argued: February 18, 2020 Decided: March 15, 2022

No. 18-1170

EXXON MOBIL CORPORATION,

Plaintiff-Appellant,

v.

MAURA TRACY HEALEY, in her official capacity as ATTORNEY GENERAL OF MASSACHUSETTS, and LETITIA JAMES, in her official capacity as ATTORNEY GENERAL OF NEW YORK, *

Defendants-Appellees.

Appeal from the United States District Court for the Southern District of New York No. 17-cv-2301, Valerie Caproni, Judge.

Before: KEARSE, SULLIVAN, AND BIANCO, Circuit Judges.

*The Clerk of Court is respectfully directed to amend the caption as set forth above. Additionally, pursuant to Rule 43(c)(2) of the Federal Rules of Appellate Procedure, Attorney General Letitia James is automatically substituted as a Defendant-Appellee for the former Attorney General of New York, Barbara D. Underwood. Plaintiff-Appellant Exxon Mobil Corporation appeals the dismissal of its complaint against the New York and Massachusetts Attorneys General, which alleged that the states’ investigations into Exxon’s purportedly deceptive speech regarding climate change were motivated by viewpoint discrimination and violated Exxon’s constitutional rights. During the pendency of this appeal, the New York Attorney General closed the New York investigation and commenced an enforcement action, which resolved in Exxon’s favor and is not being appealed by the state. Because these events have mooted Exxon’s claims against the New York Attorney General, we lack jurisdiction over those claims. As to Exxon’s claims against the Massachusetts Attorney General, Exxon could have pursued the relief it now seeks in an earlier Massachusetts state court proceeding arising from the same events that underlie the present suit; its claims against the Massachusetts Attorney General are thus barred under the doctrine of res judicata. We therefore dismiss the appeal as to the New York Attorney General and affirm the district court’s judgment as to the Massachusetts Attorney General.

DISMISSED IN PART AND AFFIRMED IN PART.

JUSTIN ANDERSON, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Washington, District of Columbia (Theodore V. Wells, Jr., Daniel J. Toal, Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York; Patrick J. Conlon, Daniel E. Bolia, Exxon Mobil Corporation, Spring, Texas, on the brief), for Plaintiff-Appellant Exxon Mobil Corporation.

SETH SCHOFIELD, Assistant Attorney General (Richard A. Johnston, Melissa A. Hoffer, Christophe G. Courchesne, Amanda Morejon, Assistant Attorneys General, on the brief), for Maura T. Healey, Attorney General of the Commonwealth of Massachusetts, Office of the Attorney General of Massachusetts, Boston, Massachusetts, for Defendant-Appellee Attorney General of Massachusetts.

2 ANISHA S. DASGUPTA, Deputy Solicitor General (Scott A. Eisman, Assistant Solicitor General, on the brief), for Letitia James, Attorney General of the State of New York, New York, New York, for Defendant-Appellee Attorney General of New York.

Jeffrey C. Mateer, First Assistant Attorney General, Brantley D. Starr, Deputy First Assistant Attorney General, James E. Davis, Deputy Attorney General for Civil Litigation, David J. Hacker, Special Counsel for Civil Litigation, for Ken Paxton, Attorney General of Texas, Austin, Texas; Steve Marshall, Attorney General of Alabama; Leslie Rutledge, Attorney General of Arkansas; Christopher M. Carr, Attorney General of Georgia; Jeff Landry, Attorney General of Louisiana; Paul R. LePage, Governor of Maine; Phil Bryant, Governor of Mississippi; Doug Peterson, Attorney General of Nebraska; Mike Hunter, Attorney General of Oklahoma; Alan Wilson, Attorney General of South Carolina; Brad Schimel, Attorney General of Wisconsin, for Amici Curiae States of Alabama, Arkansas, Georgia, Louisiana, Nebraska, Oklahoma, South Carolina, Texas, and Wisconsin, and Phil Bryant, Governor of Mississippi and Paul R. LePage, Governor of Maine in support of Plaintiff-Appellant.

Megan L. Brown, Richard W. Smith, Wiley Rein LLP, Washington, District of Columbia, for Amici Curiae National Association of Manufacturers and Chamber of Commerce of the United States of America in support of Plaintiff-Appellant.

3 Shanna M. Cleveland, Ronald A. Fein, Lisa Danetz, Free Speech for People, Newton, Massachusetts, and Steven H. Shiffrin, Cornell Law School, Ithaca, New York, for Amici Curiae Michael C. Dorf, Robert S. Stevens Professor of Law, Cornell Law School; Daniel J.H. Greenwood, Professor of Law, Deane School of Law, Hofstra University; Steven Heyman, Professor of Law, Chicago-Kent College of Law; Robert Kerr, Edith Kinney Gaylord Presidential Professor, Gaylord College, University of Oklahoma; Douglas Kysar, Deputy Dean and Joseph M. Field ’55 Professor of Law, Yale Law School; Helen Norton, Professor and Ira C. Rothgerber, Jr. Chair in Constitutional Law, University of Colorado School of Law; Tamara R. Piety, Professor of Law, University of Tulsa, College of Law; Frank Pasquale, Professor of Law, University of Maryland; Catherine J. Ross, Fred C. Stevenson Research Professor, George Washington University Law School; and Laurence H. Tribe, Carl M. Loeb University Professor and Professor of Constitutional Law, Harvard Law School in support of Defendants-Appellees.

Edward Notis-McConarty, M. Patrick Moore, Jr., Vanessa A. Arslanian, Hemenway & Barnes LLP, Boston, MA, for Amici Curiae Martha Coakley, Thomas Reilly, Scott Harshbarger, James M. Shannon, and Francis X. Bellotti, Former Attorneys General of Massachusetts in support of Defendants- Appellees.

Jillian A. Lazar, Director of Investor Protection, Marion Quirk, Joseph E. Gibbs-Tabler, Deputy Attorneys General, for Matthew P. Denn, Attorney General of Delaware, Wilmington, Delaware;

4 Benjamin Gutman, Solicitor General, Adam Holbrook, Assistant Attorney General, for Ellen F. Rosenblum, Attorney General of Oregon, Salem, Oregon; Xavier Becerra, Attorney General of California, Sacramento, California; George Jepsen, Attorney General of Connecticut, Hartford, Connecticut; Russell A. Suzuki, Attorney General of Hawaii, Honolulu, Hawaii; Lisa Madigan, Attorney General of Illinois, Chicago, Illinois; Thomas J. Miller, Attorney General of Iowa, Des Moines, Iowa; Janet T. Mills, Attorney General of Maine, Augusta, Maine; Brian E. Frosh, Attorney General of Maryland, Baltimore, Maryland; Lori Swanson, Attorney General of Minnesota, St. Paul, Minnesota; Jim Hood, Attorney General of Mississippi, Jackson, Mississippi; Gurbir S. Grewal, Attorney General of New Jersey, Trenton, New Jersey; Hector Balderas, Attorney General of New Mexico, Santa Fe, New Mexico; Joshua H. Stein, Attorney General of North Carolina, Raleigh, North Carolina; Josh Shapiro, Attorney General of Pennsylvania, Harrisburg, Pennsylvania; Peter F. Kilmartin, Attorney General of Rhode Island, Providence, Rhode Island; Thomas J. Donovan, Jr., Attorney General of Vermont, Montpelier, Vermont; Mark R. Herring, Attorney General of Virginia, Richmond, Virginia; Robert W. Ferguson, Attorney General of Washington, Olympia, Washington; Karl A. Racine, Attorney General for the District of Columbia, Washington, District of Columbia, for Amici Curiae States of California, Connecticut, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Minnesota, Mississippi, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia,

5 Washington, and the District of Columbia in support of Defendants-Appellees.

RICHARD J. SULLIVAN, Circuit Judge:

Plaintiff-Appellant Exxon Mobil Corporation (“Exxon”) appeals from a

judgment of the United States District Court for the Southern District of New York

(Caproni, J.), dismissing its complaint against Defendants-Appellees Maura

Healey, in her official capacity as Attorney General of Massachusetts, and Letitia

James, in her official capacity as Attorney General of New York, and denying leave

to amend the complaint as futile. The case, which developed a complex

procedural background before reaching the Southern District of New York, first

originated in 2016 when Exxon sued the attorneys general of New York and

Massachusetts (the “states”) under 18 U.S.C. §§ 1983 and 1985 – and their state-

law analogs – principally seeking an order barring those states from investigating

whether Exxon misled investors and the public regarding the company’s

knowledge about climate change. Among other things, Exxon alleged that the

states’ investigations into Exxon’s purportedly deceptive speech concerning

climate change were motivated by viewpoint discrimination and violated Exxon’s

constitutional rights.

6 In 2018, the district court dismissed Exxon’s claims against the

Massachusetts Attorney General, finding that the lawsuit was precluded by res

judicata because Exxon had litigated or could have litigated the present claims in

an earlier state proceeding. It dismissed Exxon’s claims against the New York

Attorney General for failure to state a claim and denied as futile Exxon’s motion

for leave to file a second amended complaint.

On appeal, Exxon challenges both grounds for dismissal and the denial of

leave to amend, contending that it stated plausible constitutional claims which

were not barred by res judicata as to the Massachusetts Attorney General. Exxon

also more specifically argues that the district court failed to address Exxon’s

viewpoint discrimination claim, improperly analyzed Exxon’s allegations and

demanded evidence, and drew inferences in favor of the Attorneys General.

During the pendency of the appeal, the New York Attorney General concluded

the New York investigation after commencing an enforcement action, which

eventually resulted in a judgment in Exxon’s favor. We therefore grant the New

York Attorney General’s motion to dismiss the appeal on the ground that Exxon’s

claims against her are moot. We also affirm the district court’s determination that

7 Exxon’s claims against the Massachusetts Attorney General are precluded by the

doctrine of res judicata.

I. BACKGROUND

A. State Court Investigations

In 2015 and 2016, respectively, the Attorneys General of New York and

Massachusetts commenced investigations into “whether ExxonMobil committed

consumer or securities fraud by misrepresenting its knowledge of climate

change.” J. App’x at 396. In November 2015, the New York Attorney General

(then-Attorney General Eric Schneiderman) served Exxon with a subpoena

seeking documents and communications related to its research on climate change.

In April 2016, the Massachusetts Attorney General served a Civil Investigative

Demand (the “CID”) to investigate potential violations of Section 2 of

Massachusetts General Laws chapter 93A, which prohibits “unfair or deceptive

acts or practices” in “trade or commerce.” J. App’x at 1026. The CID focused on

the marketing and sale of fossil fuel products to Massachusetts consumers, and on

the marketing and sale of Exxon securities to investors.

The New York Attorney General sought additional documents related to the

ongoing investigation in the fall of 2016. Although Exxon initially produced

8 documents in response to both New York subpoenas, the New York Attorney

General moved to compel further compliance with the 2015 subpoena in

November 2016. Shortly thereafter, Justice Barry R. Ostrager, who oversaw that

proceeding, set a deadline for Exxon to complete production. Exxon subsequently

certified compliance with the November 2015 subpoena.

B. Exxon’s Federal Action in the Northern District of Texas

On June 15, 2016, Exxon filed a complaint against Massachusetts Attorney

General Healey in the United States District Court for the Northern District of

Texas (Kinkeade, J.) seeking declaratory and injunctive relief under Texas and

federal law. Among other things, Exxon sought to enjoin the CID, alleging that

the Massachusetts investigation was pretextual and violated the dormant

Commerce Clause and Exxon’s rights under the First Amendment, its right to be

free of unreasonable searches under the Fourth Amendment, and its due process

rights under the Fourteenth Amendment. Exxon moved for a preliminary

injunction, while Attorney General Healey cross-moved to dismiss. The district

court sua sponte ordered certain jurisdictional discovery relevant to Attorney

General Healey’s motion to dismiss.

Exxon filed an amended complaint on November 10, 2016, adding then-

9 Attorney General Schneiderman as a defendant and including allegations

pertaining to the New York investigation. In addition to asserting various

constitutional claims, Exxon also alleged that the two Attorneys General conspired

to silence and intimidate one side of the climate policy debate through pretextual

investigations. In support of its claims that the Attorneys General were biased and

conducted investigations with improper political motives, Exxon pointed to,

among other things, public comments made by both Attorneys General at an “AGs

United for Clean Power” conference. Exxon also alleged that the two offices

received private presentations from climate activists and lawyers, who enlisted the

public officials to utilize state investigative authority to bring fossil fuel

companies’ internal corporate documents to light. The Attorneys General

eventually moved to dismiss Exxon’s amended complaint.

In December 2016, the Northern District of Texas court stayed its prior

jurisdictional discovery order, and, following the Fifth Circuit’s denial of the

Massachusetts Attorney General’s petition for a writ of mandamus, ordered

briefing on its ability to exercise personal jurisdiction over the Attorneys General.

C. Exxon’s Petition in Massachusetts State Court

On June 16, 2016, one day after Exxon filed its original complaint against the

10 Massachusetts Attorney General in Texas, Exxon separately petitioned a

Massachusetts Superior Court to set aside the CID and disqualify Attorney

General Healey. In that petition, Exxon contended – among other things – that the

CID violated state constitutional protections for free speech and freedom from

unreasonable searches, and that the CID was arbitrary and capricious.

Acknowledging that its petition raised issues that potentially overlapped

with those in its federal suit, Exxon requested that the Massachusetts Superior

Court grant a stay pending the outcome of the federal litigation in Texas. The

Massachusetts Attorney General cross-moved to compel Exxon to comply with the

CID.

On January 11, 2017, the Massachusetts Superior Court denied Exxon’s

petition to set aside the CID and granted the Massachusetts Attorney General’s

motion to compel. The Superior Court rejected Exxon’s assertion that the Attorney

General’s actions constituted political bias or viewpoint discrimination rising to

the level of arbitrary and capricious conduct, determining instead that the

Attorney General had “assayed sufficient grounds – her concerns about Exxon’s

possible misrepresentations to Massachusetts consumers – upon which to issue

the CID” and thus acted in good faith. J. App’x at 1017; see id. at 1016. But the

11 court declined to consider Exxon’s free speech claim at that time, reasoning that

the Attorney General was still investigating whether Exxon’s statements or

omissions in communications to consumers were misleading or deceptive, and

that misleading or deceptive speech would not be “entitled to any free speech

protection.” Id. at 1017 n.2. The court also denied Exxon’s motion to disqualify

Attorney General Healey, finding that her comments about the investigation at the

“AGs United for Clean Power” conference did not reveal bias.

On February 8, 2017, Exxon appealed the Superior Court’s order. In April

2018, the Supreme Judicial Court of Massachusetts (“SJC”) affirmed the Superior

Court’s decision. On January 7, 2019, the United States Supreme Court denied

Exxon’s petition for a writ of certiorari to review the SJC’s decision.

D. Transfer of the Federal Action to the Southern District of New York

On March 29, 2017, while the Massachusetts action was pending, Judge

Kinkeade sua sponte transferred the federal case from the Northern District of

Texas to “the proper venue” – the Southern District of New York – where it was

assigned to Judge Caproni. J. App’x at 988–1001. After receiving additional

briefing on the Attorneys General’s motions to dismiss and Exxon’s cross-motion

to amend its complaint, the district court (Caproni, J.) issued an order on March

12 29, 2018, dismissing the amended complaint with prejudice and denying Exxon’s

request for leave to amend as futile. Although the court found that Exxon’s claim

was ripe and that it had personal jurisdiction over the Massachusetts Attorney

General, it held that Exxon’s claims against the Massachusetts Attorney General

were barred by res judicata – also known as claim preclusion – since Exxon could

have raised those claims in the Massachusetts proceeding. As to Exxon’s

remaining causes of action against the New York Attorney General, the court

dismissed those claims pursuant to Federal Rule of Civil Procedure 12(b)(6),

concluding that Exxon had failed to plead an improper motive – a prerequisite for

each of Exxon’s constitutional claims.

E. Appeal of District Court’s Dismissal

Exxon timely appealed, challenging both the dismissal of its claims and the

denial of its motion to amend. Exxon asserts that it stated plausible constitutional

claims that were not barred by res judicata, and that the district court failed to

address Exxon’s viewpoint discrimination claim, incorrectly analyzed Exxon’s

allegations, wrongly demanded evidence at the pleading stage, and improperly

drew inferences in favor of the Attorneys General.

After the merits briefing on appeal concluded, the New York Attorney

13 General closed the New York investigation and brought an enforcement action

against Exxon in state court alleging “that Exxon engaged in a scheme to deceive

investors and the investment community about the risks posed to its business by

climate change regulation,” in violation of New York law. See Dkt. 190 (“MTD”)

at 5 (internal quotation marks omitted).

The New York Attorney General then moved in this Court to dismiss the

appeal as moot, arguing that because the Attorney General had ended the

investigation on which Exxon’s claims are based, there was no longer a live

controversy capable of redress. Exxon opposed the motion on several grounds,

including its contention that a live controversy still existed because the relief

sought in the federal action would prevent the New York Attorney General from

using wrongfully obtained documents in the state enforcement action. Exxon also

contended that the New York Attorney General’s termination of the investigation

fell under mootness exceptions for voluntary cessation of challenged conduct and

conduct capable of repetition but evading review. The New York Attorney

General’s motion was referred to this panel to be considered with Exxon’s appeal

from the district court’s ruling.

After the parties completed briefing on the motion to dismiss in this Court,

14 the state enforcement action proceeded to trial in the Commercial Division of the

New York State Supreme Court. On December 10, 2019, after a twelve-day trial,

Justice Ostrager issued a thirty-one-page decision in Exxon’s favor. See People v.

Exxon Mobil Corp., 119 N.Y.S.3d 829, 2019 WL 6795771 (N.Y. Sup. Ct. Dec. 10, 2019).

Among other things, Justice Ostrager concluded that, after an extensive three-and-

a-half-year investigation and pre-trial discovery period during which Exxon

produced “millions of pages of documents and dozens of witnesses for interviews

and depositions,” id. at *1, the New York Attorney General “failed to prove [at

trial], by a preponderance of the evidence, that ExxonMobil made any material

misstatements or omissions about its practices and procedures that misled any

reasonable investor,” id. at *30. Justice Ostrager further emphasized that the New

York Attorney General had not produced “testimony . . . from any investor who

claimed to have been misled by any [of Exxon’s] disclosure[s], even though the

Office . . . had previously represented it would call such individuals as trial

witnesses.” Id. On January 24, 2020, the New York Attorney General represented

she would not appeal Justice Ostrager’s ruling, and the time in which to do so has

since expired.

On October 24, 2019 – while this appeal was pending and the New York trial

15 was in its third day of testimony – the Massachusetts Attorney General filed a civil

complaint against Exxon under the Consumer Protection Act. That action, which

was removed to federal court and has since been remanded to state court, is still

ongoing. See Commonwealth v. Exxon Mobil Corp., No. 1984CV03333BLS1, 2021 WL

3493456, at *1 (Mass. Super. Ct. June 22, 2021) (denying Exxon’s motion to dismiss).

II. DISCUSSION

On appeal, Exxon challenges the district court’s dismissal on all grounds.

Although both Attorneys General contend that the district court properly

dismissed Exxon’s complaint for failure to state a claim, the New York Attorney

General raises a threshold question of mootness, arguing that there is no live

controversy because the New York investigation and related trial have concluded.

For her part, the Massachusetts Attorney General maintains that Exxon’s claims

are precluded under the doctrine of res judicata, as those claims could have been

raised in the Massachusetts Superior Court action. We are persuaded that the

appeal as to the New York Attorney General is moot and that res judicata bars

Exxon’s claims against the Massachusetts Attorney General, and therefore affirm

in part and dismiss in part on those grounds.

16 A. The Appeal Is Moot as to the New York Attorney General.

Because our jurisdiction is constitutionally limited to “actual, ongoing cases

or controversies,” a party must at all stages have “an actual injury . . . likely to be

redressed by a favorable judicial decision.” Lewis v. Cont’l Bank Corp., 494 U.S. 472,

477 (1990); see also Mangouras v. Squire Patton Boggs, 980 F.3d 88, 96 (2d Cir. 2020).

The parties must retain a continued “personal stake in the outcome,” even on

appeal, leaving us to resolve only “real and substantial controversies admitting of

specific relief” rather than issue decisions “advising what the law would be upon

a hypothetical state of facts.” Lewis, 494 U.S. at 477–78 (brackets and internal

quotation marks omitted). “A moot action therefore must be dismissed, even if

the case was live at the outset but later events rendered it moot on appeal.” N.Y.C.

Emps.’ Ret. Sys. v. Dole Food Co., 969 F.2d 1430, 1433 (2d Cir. 1992); see also Haley v.

Pataki, 60 F.3d 137, 141 (2d Cir. 1995) (“[I]t is axiomatic that there must be a

continuing controversy capable of redress by this Court.”).

A live controversy remains as long as “a court can fashion some form of

meaningful relief” to award the complaining party, and even “[t]he availability of

[a] possible remedy is sufficient to prevent [a] case from being moot.” Church of

Scientology v. United States, 506 U.S. 9, 12–13 (1992) (second emphasis added). This

17 inquiry is more complicated in cases involving states or state agents as

defendants – like this one – since the Eleventh Amendment bars the award of

money damages against state officials in their official capacities. See Pennhurst

State Sch. & Hosp. v. Halderman, 465 U.S. 89, 100–03 (1984). The Supreme Court has

made clear that, pursuant to the doctrine first articulated in Ex parte Young, 209

U.S. 123 (1908), a plaintiff may bring claims against a state official acting in her

official capacity only if he alleges an “ongoing violation of federal law and seeks

[injunctive] relief properly characterized as prospective.” Verizon Md. Inc. v. Pub.

Serv. Comm'n of Md., 535 U.S. 635, 645 (2002) (internal quotation marks omitted);

see Ford v. Reynolds, 316 F.3d 351, 355 (2d Cir. 2003). Accordingly, for this case to

remain live, there must be a possible effectual remedy for the violations it alleges,

and the remedy must be prospective relief that would address an ongoing

violation of federal law.

With respect to its claims against the New York Attorney General, Exxon

commenced the federal action principally to enjoin an investigation that has now

concluded. Additionally, the enforcement action that the New York Attorney

General brought based on that investigation has been resolved in Exxon’s favor.

In light of these developments, Exxon cannot now obtain the prospective relief it

18 requested in its operative complaint (to enjoin enforcement of the New York

Attorney General’s November 2015 subpoena) or in its proposed amended

complaint (to enjoin the New York Attorney General’s investigation generally).

Put simply, the Court cannot enjoin what no longer exists. See Browning Debenture

Holders' Comm. v. DASA Corp., 524 F.2d 811, 814 (2d Cir. 1975) (“[I]t is . . .

impossible to enjoin the meeting already held.”); see also Ne. Fla. Chapter of

Associated Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. 656, 670 (1993)

(O’Connor, J., dissenting) (explaining that “challenges to legislation that . . . has

been repealed, where the plaintiff has sought only prospective relief,” are moot

because “[i]f the challenged statute no longer exists . . . an order enjoining its

enforcement would be meaningless”). The question before us, then, is whether

under these circumstances Exxon retains “some interest” in the case it brought, “so

that a decision in its favor will inure to its benefit.” New England Health Care Emps.

Union, Dist. 1199, SEIU AFL–CIO v. Mount Sinai Hosp., 65 F.3d 1024, 1029 (2d Cir.

1995).

Although Exxon concedes that the New York investigation and subsequent

enforcement action have concluded, it nevertheless insists that there are additional

injunctive remedies that would constitute prospective relief for the alleged

19 violations. These include (1) the return or destruction of documents that Exxon

produced during the course of the investigation, (2) the issuance of an affirmative

injunction directing the New York Attorney General to curtail the policies that led

to the issuance of the offensive subpoenas in the first place, and (3) declaratory

relief stating “that the [New York Attorney General’s] investigation of ExxonMobil

violated its constitutional rights.” Dkt. 203 (“Exxon MTD Opp’n”) at 17–19.

To be sure, the conclusion of an investigation will not ordinarily moot a

challenge to a subpoena if a court can order “meaningful relief” by, for example,

“ordering the . . . return [of] records” provided during the investigation. Church

of Scientology, 506 U.S. at 12–13 (contemplating the return of documents as

meaningful relief in a case involving the possession of specific materials sought by

subpoena). We have also recognized that subpoena compliance does not

necessarily moot an appeal of an order enforcing a subpoena, since respondents

maintain a privacy interest in the documents they have produced and would be

entitled to their return if successful. See Washington Nat’l Ins. Co. v. OBEX Grp.

LLC, 958 F.3d 126, 133 (2d Cir. 2020); accord Life Receivables Tr. v. Syndicate 102 at

Lloyd’s of London, 549 F.3d 210, 214 n.4 (2d Cir. 2008) (acknowledging that a privacy

interest in discovered documents remains even after compliance with a subpoena);

20 United States v. Constr. Prods. Rsch., Inc., 73 F.3d 464, 469 (2d Cir. 1996) (noting in

dicta that respondents to a subpoena had a privacy interest in the return of

surrendered documents and that the case was not moot because respondents still

contested the government actor’s authority to have issued the subpoena). But this

precedent is of no moment here, since the record reflects that Exxon stipulated to

a process by which the New York Attorney General would destroy or return

confidential documents that Exxon produced in the investigation and enforcement

action. See MTD, Mot. App’x at 150–61 (“Stipulation”).

Under the terms of the Stipulation, which was executed by the parties and

ordered by the judge in the New York enforcement proceeding, Exxon agreed to a

process by which it could designate materials as confidential, in which case the

documents – including “all reproductions thereof” – would be returned or

destroyed at the conclusion of the action. See id. at 159. While the Stipulation also

permitted opposing counsel to retain certain materials such as work product,

Exxon agreed to that carve-out and has not suggested that it did not voluntarily

enter the Stipulation. Similarly, although the Stipulation is “without prejudice to

the rights of” either party “to move for relief from any of its provisions, or to seek

or agree to different or additional protection for any particular material or

21 information,” id. at 160, the mere possibility that a party may seek some

undisclosed form of additional relief – the likelihood of which has not been

shown – does not change the fact that Exxon has already obtained by stipulation a

binding commitment from the New York Attorney General to provide the very

relief that Exxon now claims to seek. As we have previously recognized,

assurances made in stipulations that agree to provide the relief sought leaves this

Court without a role with respect to such relief, particularly where there is “no

indication that [the] understanding [between the parties] has . . . been breached.”

Sanders v. Wyman, 464 F.2d 488, 490–91 (2d Cir. 1972) (dismissing appeal as moot

where the defendants signed a stipulation and order prohibiting them from

disclosing confidential information and social service records of welfare recipients

to a housing authority without the recipients’ permission, and plaintiffs did not

show future risk of the same harm or that defendants had threatened

noncompliance with the stipulation and order); cf. Hewitt v. Helms, 482 U.S. 755,

761 (1987) (“The real value of the judicial pronouncement — what makes it a

proper judicial resolution of a ‘case or controversy’ rather than an advisory

opinion — is in the settling of some dispute which affects the behavior of the defendant

towards the plaintiff.” (emphasis in original)). The Stipulation therefore provides

22 the very relief that Exxon purports to seek from the Court, eliminating any

possibility that this Court could fashion prospective relief to address an ongoing

violation of federal law. 1

As to Exxon’s belated proposals of alternative forms of injunctive relief, we

easily reject them as speculative and not sufficiently tied to an ongoing injury. For

example, Exxon does not even attempt to explain how the imposition of a monitor

“to ensure that continued viewpoint bias does not influence [the New York

Attorney General’s] decision to use official power against ExxonMobil” would

cure an ongoing violation. Exxon MTD Opp’n at 19. Exxon has not alleged any

facts to suggest continuing harms from the now-ceased investigation and resolved

enforcement action, and the alternative relief that it seeks could only address

entirely hypothetical future harms; therefore, we conclude that Exxon’s new

arguments for alternative equitable remedies cannot overcome the obvious

mootness of Exxon’s claims.

1During oral argument, Exxon asserted that the New York Attorney General has not yet returned or destroyed Exxon’s documents as required under the stipulation. Oral Argument at 1:09–4:33 (Feb. 18, 2020). In response, the New York Attorney General represented to the Court that she had not done so because the Attorney General was subject to a litigation hold pursuant to the Stipulation. Id. at 16:40–17:11; Stipulation at 160. Given that the parties voluntarily entered into a stipulation that includes a process overseen by Justice Ostrager to adjudicate the return or destruction of documents, the fact that this process was apparently not complete at the time of argument will not alter our conclusion.

23 Nor does Exxon’s request for a declaratory judgment constitute a claim for

prospective relief for an ongoing constitutional violation. In Green v. Mansour, the

Supreme Court made clear that a request for a declaratory judgment as to a past

violation cannot itself establish a case or controversy to avoid mootness. 474 U.S.

64, 73–74 (1985); see also McGinty v. New York, 251 F.3d 84, 101 (2d Cir. 2001). Again,

because the Attorney General’s investigation is over, any declaratory judgment

opining on the legality of that investigation would be “entirely retrospective

because the state [is] no longer [allegedly] violating federal law.” Ward v. Thomas,

207 F.3d 114, 119 (2d Cir. 2000); see id. at 120 (“Any declaration could say no more

than that Connecticut had violated federal law in the past . . . [and] would have

much the same effect as a full-fledged award of damages or restitution by the

federal court, the latter kinds of relief being of course prohibited by the Eleventh

Amendment.” (internal quotation marks omitted)). 2

Exxon nevertheless contends that its complaint is not moot because the New

York Attorney General’s termination of the New York investigation falls within

one of the exceptions to the mootness doctrine – as either a voluntary cessation of

2Exxon’s claimed need for a declaratory injunction is particularly curious given Justice Ostrager’s written opinion in the enforcement action. As discussed above, Justice Ostrager issued a final order in favor of Exxon, definitively rejecting the New York Attorney General’s enforcement action against Exxon. See Exxon Mobil Corp., 119 N.Y.S.3d 829, 2019 WL 6795771, at *30.

24 allegedly unlawful activity that may be freely resumed or as conduct that is

“capable of repetition while evading judicial review.” Exxon MTD Opp’n at 6. We

disagree.

Generally, the “voluntary cessation of allegedly illegal conduct” is not

enough to render a case moot. United States v. W. T. Grant Co., 345 U.S. 629, 632

(1953). Otherwise, a defendant might “strategically alter its conduct in order to

prevent or undo a ruling adverse to its interest.” E.I. Dupont de Nemours & Co. v.

Invista B.V., 473 F.3d 44, 47 (2d Cir. 2006). Nevertheless, a case involving such

voluntary cessation may be moot where “there is no reasonable expectation” of

the alleged violation’s recurrence, and interim events have “completely and

irrevocably eradicated the effects of the alleged violation.” County of Los Angeles

v. Davis, 440 U.S. 625, 631 (1979) (internal quotation marks omitted).

Exxon initially argued that the voluntary cessation exception applied

because the New York Attorney General made the decision to terminate the

investigation while continuing to reserve a right to seek discovery, and to utilize

the previously produced documents, in the civil enforcement action. In the

interim, of course, the enforcement action itself has concluded in Exxon’s favor,

and both parties have stipulated to the return or destruction of all documents

25 produced by Exxon during the investigation. Under these circumstances, interim

events have “completely and irrevocably eradicated the effects of the [New York

Attorney General’s] alleged violation,” id., and it cannot be seriously argued that

there is a reasonable expectation of the alleged violation’s recurrence.

Nor can Exxon succeed in arguing that the conduct is “capable of repetition,

yet evading review.” Irish Lesbian & Gay Org. v. Giuliani, 143 F.3d 638, 647 (2d Cir.

1998). For this exception to apply, (1) the plaintiff must have a “reasonable

expectation” that it will be subject to the same challenged action again, and (2) the

challenged conduct must be of “too short [a duration] to be fully litigated” before

its cessation. Id. at 647–48. “This facet of the mootness doctrine . . . is applicable

only in exceptional situations.” Dennin v. Conn. Interscholastic Athletic Conf., Inc.,

94 F.3d 96, 101 (2d Cir. 1996) (internal quotation marks omitted).

Exxon has failed to establish a reasonable expectation that the conduct at

issue in the present suit will recur, principally because the New York Attorney

General’s investigation and lawsuit have concluded; indeed, the state action was

resolved in Exxon’s favor, and the New York Attorney General did not appeal.

There is simply no rational basis to assume that the New York Attorney General

is poised to pursue a subsequent fraud investigation involving the same alleged

26 misconduct. Dennin, 94 F.3d at 100–01 (observing that “mere speculation that the

parties will be involved in a dispute over the same issue does not rise to the level

of a ‘reasonable expectation’ or ‘demonstrated probability’ of recurrence” (internal

quotation marks omitted)); Haley, 60 F.3d at 141 (stating that “the mere ‘theoretical

possibility’ that this scenario will arise again is not sufficient for the capable-of-

repetition exception to apply”); Knaust v. City of Kingston, 157 F.3d 86, 88 (2d Cir.

1998) (explaining that it will not “suffice to hypothesize the possibility that at some

future time, under circumstances that could only be guessed at now, the parties

could theoretically become embroiled in a like controversy once again”).

Exxon’s insistence that the New York Attorney General “continues to

defend the legality” of the office’s conduct does not alter our analysis. Exxon MTD

Opp’n at 9 (internal quotation marks omitted). Among other things, Exxon

contends that a press release issued by the New York Attorney General following

the New York court ruling contains politically motivated statements and

demonstrates that the Attorney General “continues to defend the legality and

propriety of its unconstitutional efforts to restrict speech, and . . . promises more

of the same.” Dkt. 286 at 2. But the broad statement in the press release –

proclaiming that the Attorney General “will continue to fight to ensure companies

27 are held responsible for actions that undermine and jeopardize the financial health

and safety of Americans across our country[] and . . . to end climate change,” id. at

61 – is too generic to create a reasonable expectation that another allegedly

pretextual investigation will recur. That is particularly true in light of the New

York Attorney General’s decision not to appeal the state court decision, leaving as

final and conclusive the state court’s ruling that the evidence developed as a result

of the New York Attorney General’s investigation was insufficient to subject

Exxon to state fraud liability. See Haley, 60 F.3d at 141 (rejecting as “entirely

speculative” the prospect that “a battle over the budget will occur next year” yet

evade review due to its transitory nature where that prospect was based on an

assumption that “the same principals will be involved in [the] next year’s budget

process” (internal quotation marks omitted)).

Nor can it be said that the New York Attorney General’s conduct was too

short-lived to be fully litigated before it ceased. To the contrary, Exxon’s

complaints about that conduct were fully litigated in the state court, which granted

a resounding victory for Exxon in a final judgment that the New York Attorney

28 General chose not to appeal, making further litigation of the federal issues wholly

unnecessary.

Finally, Exxon argues that even if this appeal is moot, the Court should

remand with instructions to the district court to vacate its dismissal of Exxon’s

complaint to avoid “giving preclusive effect to a judgment never reviewed by an

appellate court.” Exxon MTD Opp’n at 22 (internal quotation marks omitted)

(quoting Dole Food, 969 F.2d at 1435). As the Supreme Court stated in United

States v. Munsingwear, Inc., we ordinarily vacate the ruling that was the subject of

the appeal if mootness occurs through the unilateral action of the party prevailing

below – in this case, the New York Attorney General – or through circumstances

unattributable to either party. 340 U.S. 36, 39–41 (1950); but see U.S. Bancorp Mortg.

Co. v. Bonner Mall P’ship, 513 U.S. 18, 23, 25, 29 (1994) (noting that Munsingwear’s

description of the “‘established practice’ for vacatur was dictum” and holding that

it is generally inapplicable in the context of settlement). We need not vacate,

however, where “the party seeking relief from the judgment below caused the

mootness by voluntary action.” Doe v. Gonzales, 449 F.3d 415, 420 (2d Cir. 2006)

(internal quotation marks omitted); see U.S. Bancorp Mortg. Co., 513 U.S. at 26, 29

(holding that, barring exceptional circumstances, “mootness by reason of

29 settlement does not justify vacatur of a judgment under review” because “[i]t is

[the] petitioner’s burden, as the party seeking relief from the status quo of the

appellate judgment, to demonstrate not merely equivalent responsibility for the

mootness, but equitable entitlement to the extraordinary remedy of vacatur”).

Here, Exxon’s appeal was rendered moot by Exxon’s insistence in

proceeding to trial in the New York enforcement action, the Attorney General’s

decision not to appeal Justice Ostrager’s ruling in favor of Exxon, and the parties’

mutual agreement and stipulation to the process for the return or destruction of

documents produced by Exxon prior to trial. In situations where “mootness is

neither happenstance, nor attributable to one party but not the other,” courts are

directed to exercise discretion in determining whether to vacate. Mfrs. Hanover Tr.

Co. v. Yanakas, 11 F.3d 381, 383–84 (2d Cir. 1993) (internal citations omitted). In

doing so, we “look at the equities of the individual case,” Hassoun v. Searls, 976

F.3d 121, 130 (2d Cir. 2020) (internal quotation marks omitted), and require that

the party seeking vacatur meet its burden of demonstrating entitlement to vacatur,

see U.S. Bancorp Mortg. Co., 513 U.S. at 26.

The equities do not favor vacatur in this case. While the New York Attorney

General ultimately had final control over whether to cease the New York

30 investigation, both parties knowingly pursued the trial of the enforcement action

with vigor. Indeed, while this appeal was pending, “Exxon stopped agreeing to

toll the limitations period for [the New York Attorney General] to bring an

enforcement action,” compelling her to commence the action before Justice

Ostrager in the Commercial Division. Dkt. 207 (“MTD Reply”) at 14. Throughout

that action, Exxon pressed “to try the case in 2019” and was “delighted that [the

court was] going to move the case.” MTD, Mot. App’x at 107. Indeed, Exxon

“promise[d]” the state court that the parties would “come back with an expedited

trial schedule.” Id. Given these facts, we conclude that the New York Attorney

General was not solely responsible in mooting the appeal.

To be clear, Exxon’s actions in nudging this case toward potential mootness

were by no means improper, and we do not suggest that Exxon engaged in any

sort of gamesmanship – only that the likely consequences of its litigation strategy,

including the mootness of this appeal, were obvious. In essence, Exxon pursued a

two-front campaign in which a victory in either court would achieve its objectives.

Having framed its federal complaint around the harms allegedly caused by

the New York Attorney General’s investigation, Exxon should have understood

that its voluntary actions in state court – which, again, facilitated the end of the

31 complained-of investigation and opened to Exxon the now-realized possibility of

prevailing on the enforcement action – risked mooting this appeal. See U.S.

Bancorp Mortg. Co., 513 U.S. at 29 (declining to grant vacatur where party seeking

relief from adverse decision participated in actions that mooted dispute on

appeal); Russman v. Bd. of Educ. of Enlarged City Sch. Dist. of Watervliet, 260 F.3d 114,

121–23 (2d Cir. 2001) (noting that an appellant’s conduct can “constitute

‘forfeiture’ of the benefit of vacatur” where it “knew or should have known that

his conduct was substantially likely to moot the appeal”); see also In re W. Pac.

Airlines, Inc., 181 F.3d 1191, 1194, 1197–98 (10th Cir. 1999) (declining to vacate

orders at issue in the appeal in part because appellants “contribut[ed] to the

mootness of th[e] appeal by failing to seek a stay” pending review of bankruptcy

court order).

Under these circumstances, and bearing in mind that “[j]udicial precedents

are presumptively correct[,] . . . valuable to the legal community as a whole,” and

“should stand unless a court concludes that the public interest would be served by

a vacatur,” U.S. Bancorp Mortg. Co., 513 U.S. at 26, we are not persuaded that Exxon

has carried its burden to show that it is equitably entitled to the “extraordinary

32 remedy of vacatur,” id.; see also Doe, 449 F.3d at 420–21. We therefore dismiss the

appeal as to the New York Attorney General.

B. Exxon’s Claims Against the Massachusetts Attorney General Are Precluded.

With respect to its claims against the Massachusetts Attorney General,

Exxon argues that “[r]es judicata does not apply . . . because the claims asserted in

[the federal] action were not raised in or decided by the Massachusetts state court.”

Exxon Br. at 54. During oral argument, Exxon stressed that res judicata is

concerned with “claim” preclusion and not “argument” preclusion, leaving Exxon

free to raise constitutional arguments in state court to set aside the CID while

preserving its constitutional claims in federal court to enjoin the CID’s

enforcement. Again, we disagree.

Federal courts are required to “give preclusive effect to state-court

judgments whenever the courts of the [s]tate from which the judgments emerged

would do so.” Allen v. McCurry, 449 U.S. 90, 96 (1980). In Massachusetts, a prior

court decision may have claim-preclusive effect when there is “(1) the identity or

privity of the parties to the present and prior actions, (2) identity of the cause of

action, and (3) [a] prior final judgment on the merits.” Kobrin v. Bd. of Registration

in Med., 444 Mass. 837, 843 (2005) (citation omitted). Importantly, under

33 Massachusetts law, res judicata “prevents relitigation of all matters that . . . could

have been adjudicated,” not just those that were. Id. (citation omitted).

Applying these principles to the two actions before us, we agree with the

district court that all three elements of the res judicata test have been satisfied here.

1. The Parties in the Massachusetts and Federal Actions Are Identical.

Neither Exxon nor the Massachusetts Attorney General disputes that there

is a complete identity of the parties in the two actions. On June 15, 2016, Exxon

filed its federal complaint against the Massachusetts Attorney General in the

Northern District of Texas; a day later, it commenced an action in Massachusetts

Superior Court to set aside the CID and disqualify Attorney General Healey.

Accordingly, the first element of the res judicata test is clearly satisfied.

2. The Proceedings Raise Identical Claims.

Claims share identity when they “grow[] out of the same transaction, act, or

agreement, and seek[] redress for the same wrong.” Fassas v. First Bank & Tr. Co.

of Chelmsford, 353 Mass. 628, 629 (1968) (quoting Mackintosh v. Chambers, 285 Mass.

594, 596 (1934)). Claims can be identical for preclusion purposes even if raised

from “different posture[s] or in . . . different procedural form[s].” Wright Mach.

Corp. v. Seaman-Andwall Corp., 364 Mass. 683, 688 (1974). In fact, claim preclusion

34 may apply even when a claim has not been actually litigated in a prior proceeding,

as long as the claim could have been litigated in that first proceeding. See U.S. Nat’l

Ass’n v. McDermott, 87 Mass. App. Ct. 1103, 2015 WL 539311, at *1–2 (Jan. 30, 2015).

Parties cannot skirt res judicata merely “by seeking an alternative remedy,” Wright

Mach. Corp., 364 Mass. at 688, as “[t]he statement of a different form of liability is

not a different cause of action,” Fassas, 353 Mass. at 629 (internal quotation marks

omitted). That is because “[t]he effect of a former judgment . . . depends not upon

the form of the pleadings but upon the essence of the violation of legal right on

which pleadings are founded.” Mackintosh, 285 Mass. at 597.

Although raised in distinct procedural forms, Exxon’s state court petition

and federal complaint both concern the same essential violations of legal rights.

Both identify the same relevant injury: the CID’s alleged violation of various

federal constitutional provisions and their state analogues. For example, in its

state court petition to set aside the CID, Exxon alleged that “the CID constitutes

impermissible viewpoint discrimination by targeting ExxonMobil’s climate

change speech.” J. App’x at 1044. Similarly, in its first amended complaint in the

35 federal case, Exxon alleged that “the CID [is an] impermissible viewpoint-based

restriction[] on speech.” Id. at 434. 3

Moreover, the facts “relied upon to prove liability are essentially the same

as to both cases.” Ratner v. Rockwood Sprinkler Co., 340 Mass. 773, 776 (1960). As

the district court recognized, both sets of claims find support in overlapping facts,

including, among other things, allegations that (1) the New York and

Massachusetts Attorneys General joined the “AGs United for Clean Power”

conference, (2) climate activists gave private presentations to the Attorneys

General, (3) the Attorneys General publicly spoke with bias against Exxon, and (4)

the Attorneys General initiated overreaching and politically motivated

investigations in bad faith. See Exxon Mobil Corp. v. Schneiderman, 316 F. Supp. 3d

3 See also J. App’x at 1044 (alleging in the state petition that “in violation of ExxonMobil’s rights under Article XIV of the Massachusetts Constitution, the CID launches an unreasonable fishing expedition”); id. at 434–35 (alleging in the amended federal complaint that “[t]he subpoena and CID are each unreasonable searches and seizures because each of them constitutes an abusive fishing expedition . . . [which] violate[s] the Fourth Amendment’s reasonableness requirement”); id. at 1044 (alleging in the state petition that the CID violates Exxon’s “due process right under Article XII of the Massachusetts Constitution to a disinterested prosecutor”); id. at 435 (alleging in the amended federal complaint that “[t]he subpoena and CID deprive ExxonMobil of due process of law by violating the requirement that a prosecutor be disinterested”). Moreover, the federal Commerce Clause claim, which does not have a Massachusetts analog, is identical for res judicata purposes to the state claims. Both sets of claims concern the purported unconstitutionality of the CID and draw from the same purportedly wrongful acts, alleging that the CID was intended to regulate Exxon’s speech “while only purporting to investigate” Exxon for deceptive practices. Id. at 436.

36 679, 701–02 (S.D.N.Y. 2018). [See also JA-1024–28.] Indeed, Exxon itself implied

that the two actions involved overlapping claims – not merely overlapping

arguments – in its state court filings. See J. App’x at 1111 (requesting that the state

court “defer[] considerations of claims that overlap with those presented in the

federal case”). 4

The fact that the actions arose in different procedural circumstances – via an

action to stop CID enforcement under Section 6(7) of Massachusetts General Laws

chapter 93A in the state case versus an affirmative § 1983 claim in federal court –

does not affect our analysis. See Wright Mach. Corp., 364 Mass. at 688–89. Nor does

it matter that the two actions sought nominally different remedies. See Tuite &

Sons, Inc. v. Shawmut Bank, N.A., 43 Mass. App. Ct. 751, 754 (1997) (rejecting

attempt to avoid res judicata by characterizing “affirmative damages” as distinct

from a defensive “offset” because “the gravamen of both actions is

indistinguishable”). So long as the same relief was available in the Massachusetts

proceeding, the fact that Exxon opted to seek different forms of relief in the two

actions is irrelevant to the issue of claim preclusion.

4 Exxon makes much of the SJC’s observation of “only a partial overlap in the subject matter of [the] two actions,” Exxon Br. at 21 (quoting Exxon Mobil Corp. v. Att’y Gen., 479 Mass. 312, 329 (2018)), but the SJC’s short statement offers little insight about which claims in the state and federal actions overlap or the significance of the differences between the claims that do not overlap.

37 Exxon nevertheless insists that the “state proceedings pertained to the

enforcement of a specific CID, while [the federal] action seeks an injunction of

Attorney General Healey’s investigation,” Exxon Br. at 55, and further contends

that certain declaratory and injunctive relief available for its affirmative § 1983

claims would not have been available in the “limited” CID proceeding, id. at 58–

60. 5 But the specific relief that Exxon now claims was available only in federal

court – namely, an injunction prohibiting pretextual investigations and ending the

Massachusetts Attorney General’s investigation – was equally available in state

court. For starters, Exxon’s emergency motion to set aside the CID acknowledged

that its Massachusetts action “seeks the same relief as [the] earlier-filed [federal]

action.” J. App’x at 1111–12 (emphasis added). In fact, Exxon repeatedly asserted

that adjudicating both actions would result in relief that was “duplicative” or

would render the latter action “moot.” See id. at 1046 (noting in CID petition that

“[s]taying the adjudication of this Petition would avoid the possibility of

duplicative or inconsistent rulings on ExxonMobil’s constitutional challenges to

5Notably, Exxon did not seek an injunction “halting or appropriately limiting the investigations” until it proposed filing a second amended complaint. See J. App’x at 1983–84. The company’s original complaint and first amended complaint requested only an injunction prohibiting enforcement of the CID – the very relief sought in the Massachusetts CID action. See id. at 84–85, 438.

38 the CID”); id. at 1077 (Exxon arguing in support of its motion to set aside the CID

that, if granted, “the relief sought in [the federal] action would render this Petition

and motion moot”).

Although Exxon did argue to the SJC that a resolution of the issues pending

in the state suit would not “resolve the broader issues that are pending in [f]ederal

[c]ourt,” J. App’x at 1125, Exxon also conceded that all of its claims against the

Massachusetts Attorney General in both actions arose from the same operative

facts, id. at 1133–34. And it bears noting that Exxon did not merely seek to quash

or modify the CID under Section 6(7) of Massachusetts General Laws chapter 93A;

it also requested equitable relief relating to the broader investigation – asking the

state court to exercise its “inherent authority” to disqualify Attorney General

Healey from the investigation because of her public statements suggesting bias

against Exxon. See J. App’x at 1042–43; see also id. at 1060 (requesting

disqualification if the court “determines that it can exercise personal jurisdiction

over ExxonMobil”); Eli Lilly & Co. v. Gottstein, 617 F.3d 186, 195 (2d Cir. 2010)

(stating that a “protective order, like any ongoing injunction, is always subject to

the inherent power of the district court” and “might be thought of as a form of

injunction in . . . particular setting[s]” (internal quotation marks omitted) (quoting

39 Poliquin v. Garden Way, Inc., 989 F.2d 527, 535 (1st Cir. 1993)). The record thus

demonstrates that Exxon understood it could plead in the alternative – without

being concerned about waiving its personal jurisdiction objections – and request

relief outside the four corners of a traditional motion to quash. See Booth v. Augis,

72 Mass. App. Ct. 164, 168–69 (2008) (distinguishing cases like Heacock v. Heacock,

402 Mass. 21 (1988), “where the court in the first action . . . lacked jurisdiction to

hear the claims sought to be precluded in the second action (or to award the full

measure of relief)”); Exxon Mobil Corp., 479 Mass. at 329 n.15 (explaining that the

Superior Court “is not . . . limited [in its jurisdiction], and may hear any case under

[chapter] 93A ‘for damages and such equitable relief, including an injunction, as

the court deems to be necessary and proper’”(citation omitted)).

We are also unpersuaded by Exxon’s contention that res judicata does not

apply because the Massachusetts CID proceeding was limited in nature and thus

failed to provide Exxon with a full and fair opportunity to litigate its federal

claims. In a case involving New York’s res judicata law – which mirrors

Massachusetts law on that score – this Court rejected the suggestion that litigants

are in a “defensive” posture when they bring special proceedings objecting to

government actions; moreover, we expressly dismissed the notion that being in a

40 “defensive” posture would alter the analysis for claim preclusion. Bartel Dental

Books Co. v. Schultz, 786 F.2d 486, 489 & n.1 (2d Cir. 1986) (barring litigation of

§ 1983 claims that were or could have been litigated in state proceeding). Under

the essentially identical Massachusetts preclusion test, any differences in Exxon’s

ability to assert objections in the CID proceeding are therefore irrelevant.

Accordingly, we find that the claims brought in the federal action could

have been raised in the CID proceeding and are therefore identical for purposes of

Massachusetts res judicata law.

3. There Is a Prior Final Judgment on the Merits.

Finally, as to the third res judicata element, there can be no dispute that the

Massachusetts Superior Court issued a final order on January 11, 2017, which

denied Exxon’s petition to set aside the CID and granted the Massachusetts

Attorney General’s petition to compel Exxon’s production of documents. [JA-

1009–14.] Exxon appealed that final order to the SJC, which affirmed the Superior

Court’s decision on April 13, 2018. Exxon then sought certiorari before the United

States Supreme Court, which denied the petition on January 7, 2019. [Dkt. 213.]

Notwithstanding this series of final orders, Exxon argues that there was no

final judgment on the merits because the Superior Court expressly reserved

41 decision on Exxon’s constitutional claims. This argument is largely based on a

footnote in the Superior Court’s opinion in which the court stated that it would

“not address Exxon’s arguments regarding free speech at this time because

misleading or deceptive advertising is not protected by the First Amendment.” In

re Civ. Investigative Demand No. 2016-EPD-36, No. SUCV20161888F, 2017 WL

627305, at *4 n.2 (Mass. Super. Ct. Jan. 11, 2017). Reading the footnote to mean that

the court expressly reserved decision on the constitutional claims at issue here,

Exxon argues that “[n]o Massachusetts court has held [that res judicata] applies to

matters that a court could have adjudicated but elected not to.” Exxon Reply Br.

at 31.

But Exxon misconstrues the footnote in question. Considered in its entirety,

the Superior Court’s opinion clearly reflects that it rejected Exxon’s free speech

arguments centered on viewpoint discrimination after considering Exxon’s

contentions that the CID violated various state constitutional guarantees –

guarantees that Exxon acknowledged were coextensive with the First

Amendment. See, e.g., J. App’x at 1100 (Exxon arguing in its motion to set aside or

modify the CID that “Article XVI, like the First Amendment, prohibits government

action that targets speech because of its content” and citing Massachusetts case

42 law stating that Article XVI is coextensive with the First Amendment). Indeed,

Exxon thoroughly litigated its constitutional arguments before the Superior Court.

See id. at 1044 (Exxon arguing that Article XVI – the state First Amendment

analogue – “prohibits the Attorney General from issuing a CID to prescribe what

shall be orthodox in matters of public concern”); id. at 1071 (Exxon arguing that

the CID violates Article XVI, because it “impermissibly infringes ExxonMobil’s

political speech”); id. at 1073 (Exxon arguing that pursuant to Article XIV – the

state analogue to the Fourth Amendment – “‘unreasonable’ civil investigative

demands ‘must be quashed or modified’” (citation omitted)); see also id. at 1216–18

(counsel for the Attorney General addressing at oral argument whether the CID

violates free speech and unreasonable search and seizure guarantees).

The footnote on which Exxon stakes its argument in no way limited or

conditioned the state court’s decision to uphold the CID, and the record reflects

that the court could not have upheld the CID without first concluding that Exxon’s

impermissible motive claims were meritless. See Att’y Gen. v. Colleton, 387 Mass.

790, 800 (1982) (explaining that “[civil investigative] demands which invade any

constitutional rights of the investigated party cannot be condoned”). We therefore

find that the constitutional claims against the Massachusetts Attorney General

43 were fully litigated and decided in a final judgment on the merits.

* * *

Because all three elements of the Massachusetts claim preclusion test have

been satisfied, we agree with the district court that Exxon’s First Amendment

claims are barred by the doctrine of res judicata.

III. CONCLUSION

For the reasons stated above, we conclude that Exxon’s claims against the

New York Attorney General are moot and grant the Attorney General’s motion to

dismiss, see Dkt. 190, as the Attorney General’s investigation has ceased, the

subsequent enforcement action has been decided in Exxon’s favor, and the state is

not appealing that decision. We further conclude that Exxon’s claims against the

Massachusetts Attorney General are barred under the doctrine of res judicata, as

Exxon could have pursued the relief it now seeks in an earlier Massachusetts state

court proceeding arising from the same underlying events. Accordingly, we

DISMISS Exxon’s appeal as to the New York Attorney General and AFFIRM the

district court’s judgment as to the Massachusetts Attorney General.