February, 10 2022, 09:58am EDT
Amazon, Comcast Seek to Silence Shareholder Voices on Fossil-Filled 401(k) Plans
Company retirement plans are out of alignment with corporate climate goals, forcing employees to invest in oil, coal, and deforestation.
WASHINGTON
Last week, Amazon and Comcast filed "no-action" motions with the U.S. Securities and Exchange Commission (SEC) to exclude As You Sow shareholder resolutions from company proxy statements. The two resolutions ask for reports assessing brand damage due to the conflicts between their high carbon 401(k) retirement plans and corporate climate goals. The "no-action" requests seek to silence shareholders asking a simple and compelling question about how the company operates under one set of policies for its operations and the opposite in its employee retirement investments.
"The Amazon retirement plan directs employee savings into companies burning down the Amazon," said As You Sow CEO Andrew Behar. "We are asking the board to assess the likelihood of brand damage as the company says one thing on climate and does another. We are pleased to see Amazon purchasing 100,000 electric vehicles and powering data centers with renewables, but how far does that go when the company invests $551 million in oil, coal, and fossil-fired utilities and $44 million in deforestation-risk agribusiness? Shareholders would like to see a coherent policy on climate across the company's operations and investments."
As You Sow, a nonprofit shareholder advocacy organization, publishes monthly report cards rating mutual funds and retirement plans as part of its Invest Your Values initiative. Amazon and Comcast use Vanguard Target Date funds as their default retirement options, resulting in the majority of plan investments flowing into funds holding companies flagged as major greenhouse gas emitters, and involved in Indonesia and Amazon rainforest destruction. While Amazon does offer one "sustainable option" for its employees, less than 2% of the plan's assets are invested in it. Yet, in interviews with Amazon employees and in polls with investors broadly, more than 70% say that they would like to invest sustainably and, specifically, not in oil, coal, and deforestation.
In multiple meetings with Amazon executives and senior attorneys, As You Sow advocates were told that the company intended to make no changes even though company representatives acknowledged their funds being out of alignment with company climate goals. The corporate giant also refused to improve training to help interested employees understand how to shift their savings to the one sustainable option.
"Comcast is really a laggard," continued Behar. "They have no sustainable option at all. Every investment in their plan gets a C or lower for fossil fuels on our Invest Your Values report card, and the majority get a D or F. With $924 million invested in fossil fuels and $61 million in deforestation-risk agribusiness we are asking the board for a report to explain the cognitive dissonance in these choices and how this looks to our customers and our employees. In addition, Comcast is headquartered in Philadelphia, a city with one of the highest incarceration rates in the country, and their default investment gets an F for Prison Industrial Complex due to investments in private prison companies."
In a meeting with senior Comcast executives, they stated their intention to make no changes regardless of possible brand damage, alienating their employees, and reducing their ability to attract and retain the best and the brightest.
Each company's "no-action" request makes the argument that shareholders do not have a right to ask these types of questions about conflicting corporate policies leading to material risk. As You Sow is challenging the "no-action" requests by filing briefs with the SEC to defend the rights of shareholders to not be silenced.
As You Sow is the nation's non-profit leader in shareholder advocacy. Founded in 1992, we harness shareholder power to create lasting change that benefits people, planet, and profit. Our mission is to promote environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies.
LATEST NEWS
In Supreme Court Briefs, Biden DOJ Sides With Communities Suing Big Oil
"The Justice Department has affirmed again that communities deserve their day in court to put Big Oil companies on trial for their climate lies and the resulting harms."
Dec 11, 2024
Campaigners and experts on Wednesday welcomed the Biden administration's new briefs urging the U.S. Supreme Court not to intervene in state and local lawsuits that aim to hold fossil fuel giants accountable for lying to the public about their contributions to the climate emergency.
The Tuesday filings in Sunoco v. the City and County of Honolulu and Alabama v. California align with U.S. Solicitor General Elizabeth Prelogar's amicus brief last year, which stemmed from Colorado communities suing Big Oil. Following that filing, the justices declined to hear five appeals from fossil fuel companies trying to shift climate liability cases from state to federal court.
The U.S. Supreme Court—which has a right-wing supermajority—asked Prelogar to weigh in again this past June and October. Her new filings have climate advocates hopeful that the justices will follow their previous path and let the cases against major polluters advance in state court.
"The Justice Department has affirmed again that communities deserve their day in court to put Big Oil companies on trial for their climate lies and the resulting harms," said Richard Wiles, president of the Center for Climate Integrity (CCI), in a statement. "Big Oil companies are desperate to avoid facing the evidence of their deception in a courtroom, but wanting to escape the consequences for your actions is not the same thing as having the law on your side."
"As the solicitor general makes clear, there is no legal basis for the Supreme Court to intervene in these cases."
In Honolulu's case—intended to make companies including BP, Chevron, ExxonMobil, and Shell pay for local climate damages—the Hawaii Supreme Court rejected the fossil fuel industry's argument that "state law claims alleging the deceptive marketing of fossil fuel products were either governed by the federal common law of transboundary air pollution or preempted by the Clean Air Act."
Prelogar made the case that the country's highest tribunal "does not have jurisdiction to review the Hawaii Supreme Court's interlocutory decision" that allowed Honolulu's suit to proceed, "and even if it did, further review at this time would be unwarranted."
For the other case—which involves 19 state attorneys general trying to stop climate deception suits in California, Connecticut, Minnesota, New Jersey, and Rhode Island—Prelogar wrote that "there is no merit to the contention that the federal common law of transboundary air pollution governs (and therefore precludes) the defendant states' claims."
The solicitor general also argued that the attorneys general working on behalf of Big Oil lack standing; "the only interests directly at stake are the interests of private energy companies," not the citizens of each state; and "the very suits that the complaint seeks to enjoin are better forums for resolving the issues raised."
Alyssa Johl, vice president of legal and general counsel for CCI, said that "as the solicitor general makes clear, there is no legal basis for the Supreme Court to intervene in these cases. State and local governments are seeking to hold corporations accountable for lying about their harmful products, and state courts have the authority to hear those claims. The justices should reject these meritless requests and allow communities to have their day in court to hold Big Oil accountable."
Experts at the Union of Concerned Scientists (UCS) agreed. Delta Merner, lead scientist for the group's Science Hub for Climate Litigation, said the new briefs "represent an important step in the pursuit of climate accountability" and "reaffirm that communities have the right to hold fossil fuel companies accountable for decades of misleading the public about the harms associated with their products."
"Research has shown how fossil fuel companies knowingly concealed the dangers of their products while misleading the public—a pattern of misconduct that contributed directly to today's climate crisis," she noted. "These cases seek to give communities the chance to present this evidence in court, shining a light on the broader impacts of corporate disinformation campaigns."
"We applaud the Biden administration's continued support for these lawsuits and urge the incoming Trump administration to continue following science and clear legal arguments."
Kathy Mulvey, director of the climate accountability campaign at UCS, stressed that "communities like Honolulu are bearing the financial burden of addressing climate damages, using public dollars to remediate harms caused by decades of deception by fossil fuel companies."
"A core principle of accountability is timely access to justice through the courts. Honolulu and other communities have already waited years to present their evidence and argue their claims," she added. "We applaud the Biden administration's continued support for these lawsuits and urge the incoming Trump administration to continue following science and clear legal arguments."
Honolulu's suit is just one of dozens that state and local governments have filed against the fossil fuel industry—and Prelogar's brief last year notably represented a departure from the first Trump administration's support for Big Oil. Her new briefs come as the nation prepares for President-elect Donald Trump to return to the White House next month, with a Republican-controlled Congress.
Shortly after the GOP electoral victories last month, Emily Sanders a senior reporter for the CCI project ExxonKnews, spoke with multiple legal experts who framed the courts as key to Big Oil accountability with Trump and Republican lawmakers in power.
"It's not a stretch to say the message coming from the federal executive branch writ large and large numbers of Congress is going to be climate denial and misrepresentations," said Pat Parenteau, an environmental law professor and senior fellow at Vermont Law School. "So these cases and these jury verdicts are going to be even more important to correct the record to the extent you can."
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Big Pharma Drug Patent Abuses Cost Medicare Billions: Report
"As CMS negotiates the prices Medicare will pay for top-selling drugs, it should take into account the billions we've already lost due to these patenting tactics," said one researcher.
Dec 11, 2024
When the Inflation Reduction Act became law in 2022, it included a historic provision that gave the Centers for Medicare and Medicaid Services (CMS) the ability to negotiate maximum fair prices for select drugs. This means that CMS now has an important tool to resist high prices imposed by pharmaceutical companies and lower the cost that Medicare recipients pay for their drugs. So far, Medicare has negotiated the maximum fair prices for 10 drugs, which will go into effect January 1, 2026.
But according to a report released Wednesday by the watchdog group Public Citizen, the manufacturers behind these drugs are able to rely on another method to protect their profits: patent abuses and evergreening tactics.
The report defines "evergreening tactics" as the practice of "patenting trivial and/or obvious modifications of existing medications to lengthen exclusivity on branded medicines."
The makers of the drugs Eliquis, Imbruvica, Jardiance, Farxiga, and Entresto, for example, obtained patents on what constitute trivial or minor changes to earlier patent claims, "such as crystalline forms of drug compounds which would be discovered and managed during routine testing that is part of the drug approval process," according to Public Citizen. These new patents allow the manufacturers to extend their monopoly on these drugs.
"Big Pharma patent abuse is cheating Medicare enrollees of more affordable drugs and costing taxpayers billions," said Public Citizen Access to Medicines program researcher Jishian Ravinthiran in a statement.
"Patent abuses enable Big Pharma companies to unfairly extend their monopolies and keep prices artificially high. As CMS negotiates the prices Medicare will pay for top-selling drugs, it should take into account the billions we've already lost due to these patenting tactics," he added.
The report makes this same point, arguing that the agency's initial offers on pharmaceuticals should take into account how long-monopoly drugs have been able to obtain longtime exclusivities on medicines by manipulating patents.
This is paramount, Public Citizen argues, given the scope of lost savings. The group estimates that Medicare will lose somewhere between $4.9 and $5.4 billion in savings that should have accrued to taxpayers if four out of the 10 drugs did not take advantage of patenting tactics, and therefore would have faced greater competition prior to negotiation.
"These lost savings are nearly as much as what Medicare is expected to save if negotiated prices go into effect on all of the selected drugs in the first year of the program ($6 billion)," according to the report.
As an example, the drug etanercept, which is marketed as Enbrel, is on the list of 10 drugs that will be subject to a negotiated cap come January 2026. Etanercept's maker Amgen did not contribute to the original research and development of etanercept, per Public Citizen, it just acquired the original maker of the drug, Immunex, in 2002.
Immunex's patent of etanercept was set to expire in 2019, but "by using abusive patent practices" Amgen was able to extend the patent protections through 2029, according to Public Citizen. Amgen was able to evade competition of two potential "biosimilar" competitors, Erelzi and Eticovo, which received FDA approval in the 2010s.
Referencing analysis done in a separate report, Public Citizen estimated "that biosimilars could have entered the market after August 2019 were it not for Amgen's unwarranted patent exclusivities, and we calculated Medicare would have spent $1,891,500,836 less on a net basis had enrollees been able to use lower-cost alternatives by the time negotiated prices go into effect on January 1, 2026."
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Survivor of US Atomic Bombing Makes Plea to World With Nobel Acceptance Speech
"Let us all strive together to ensure that humanity is not destroyed by nuclear weapons, and to create a human society where there are no nuclear weapons and no war," said Terumi Tanaka.
Dec 11, 2024
Accepting the 2024 Nobel Peace Prize on behalf of the grassroots Japanese anti-nuclear group he co-chairs, Terumi Tanaka warned on Tuesday night that the world is moving in the opposite direction than the one hibakusha—survivors of the U.S. bombings of Hiroshima and Nagasaki—have demanded for nearly seven decades.
Tanaka is a co-chair of Nihon Hidankyo, an organization founded in 1956 by survivors of the bombings that had killed an estimated 140,000 people in Hiroshima and 70,000 in Nagasaki, with the death toll continuing to rise in later years as people succumbed to the effects of radiation.
The group accepted the Nobel Peace Prize in Oslo, with the Nobel Committee honoring Nihon Hidankyo "for its efforts to achieve a world free of nuclear weapons."
The organization aims to maintain a taboo around the use of nuclear weapons, which have only been used in combat by the U.S. in Japan in 1945.
Tanaka warned that there are currently 12,000 nuclear warheads in the arsenals of the U.S., Russia, China, and six other countries, and 4,000 of those "could be launched immediately."
"This means that the damage that occurred in Hiroshima and Nagasaki could be multiplied by hundreds or even thousands," said Tanaka, who is 92. "Let us all strive together to ensure that humanity is not destroyed by nuclear weapons, and to create a human society where there are no nuclear weapons and no war."
"It is the heartfelt desire of the hibakusha that, rather than depending on the theory of nuclear deterrence, which assumes the possession and use of nuclear weapons, we must not allow the possession of a single nuclear weapon," he added.
"I hope that the belief that nuclear weapons cannot—and must not—co-exist with humanity will take firm hold among citizens of the nuclear weapon states and their allies, and that this will become a force for change in the nuclear policies of their governments."
Tanaka said that "the nuclear taboo threatens to be broken," as evidenced by Israeli Heritage Minister Amihay Eliyahu's recent comment that a nuclear attack on Gaza would be "one way" to defeat Hamas.
"I am infinitely saddened and angered" by such statements, said Tanaka.
He described his experience as a 13-year-old when the U.S. bombed Nagasaki, just a couple of miles away from his family's house, which was crushed by the impact.
He said he later found the charred body of one of his aunts and saw his grandfather close to death from the burns that covered his body.
"The deaths I witnessed at that time could hardly be described as human deaths," Tanaka said. "There were hundreds of people suffering in agony, unable to receive any kind of medical attention."
"I hope that the belief that nuclear weapons cannot—and must not—co-exist with humanity will take firm hold among citizens of the nuclear weapon states and their allies, and that this will become a force for change in the nuclear policies of their governments," said Tanaka.
The International Campaign to Abolish Nuclear Weapons (ICAN) applauded Nihon Hidankyo and the hibakusha "for their resilience and willingness to share their stories over and over again, so that the world may learn and come together to say 'never again.'"
"It was their courage that enabled the [Treaty on the Prohibition of Nuclear Weapons] to be adopted, which represents the first progress on nuclear disarmament in decades," said Melissa Parke, executive director of ICAN, referring to the treaty that's been ratified by 73 countries.
"Listening to Mr. Tanaka describe the horrendous effects on his family and city when the Americans dropped their atomic bomb should convince world leaders they have to go beyond simply congratulating the hibakusha of Nihon Hidankyo for this award. They must honor them by doing what the hibakusha have long called for—urgently getting rid of nuclear weapons," said Parke. "That is the only way to ensure that what Mr. Tanaka and the other hibakusha have been through never happens to anyone ever again. As long as any nuclear weapons remain anywhere, they are bound one day to be used, whether by design or accident."
Jørgen Watne Frydnes, chair of the Nobel Committee, condemned the nine nuclear powers for "modernizing and building up their nuclear arsenals."
"It is naive to believe our civilization can survive a world order in which global security depends on nuclear weapons," Frydnes said. "The world is not meant to be a prison in which we await collective annihilation."
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