Failure to cover issue compounds false ad
It’s called lying by material omission
[Update – NJ Spotlight reply below]
NJ Spotlight is running the ad above today by the PennEast pipeline. (view it online)
The ad is false and highly misleading. PennEast has not been “approved”.
If that ad were presented in certain forums, it would trigger enforcement sanctions (e.g. for misleading investors – SEC) – or be evidence of fraud:
The elements of a cause of action for fraud are: (1) that a material representation was made; (2) the representation was false; (3) when the representation was made, the speaker knew it was false or made it recklessly without any knowledge of the truth and as a positive assertion; (4) the speaker made the representation with the intent that the other party should act upon it; (5) the party acted in reliance on the representation; and (6) the party thereby suffered injury.
PennEast has not received the most critical approval it must secure – a regulatory approval that has been used by the States of New York and Connecticut to kill pipelines just like PennEast.
That approval is the federal Clean Water Act Section 401 Water Quality Certificate (401 WQC), which must be issued by NJ DEP.
A 2006 US Supreme Court decision, S. D. Warren v. Maine Board of Environmental Protection, upheld and stressed the power of State’s under Section 401 of the Clean Water Act. The Court found Section 401 part of an “essential scheme” to protect State interests (emphases mine):
State certifications under §401 are essential in the scheme to preserve state authority to address the broad range of pollution, as Senator Muskie explained on the floor when what is now §401 was first proposed:
“No polluter will be able to hide behind a Federal license or permit as an excuse for a violation of water quality standard[s]. No polluter will be able to make major investments in facilities under a Federal license or permit without providing assurance that the facility will comply with water quality standards. No State water pollution control agency will be confronted with a fait accompli by an industry that has built a plant without consideration of water quality requirements.” 116 Cong. Rec. 8984 (1970).
These are the very reasons that Congress provided the States with power to enforce “any other appropriate requirement of State law,” 33 U. S. C. §1341(d), by imposing conditions on federal licenses for activities that may result in a discharge, ibid.
That 401 WQC State regulatory review is currently ongoing at NJ DEP, which makes the PennEast false “approved” ad even more troubling.
Curiously, despite numerous posts on the 401 WQC here and several emails to NJ Spotlight environmental reporters Jon Hurdle and Tom Johnson, I have been unable to convince Spotlight to cover the issue.
The very little coverage Spotlight has provided related to the 401 WQC has not been accurate, and I have emailed them to explain the errors.
I just emailed Spotlight editor Lee Keough to advise her that false advertising compounds their failure to cover the 401 WQC issue, which I find deeply disturbing.
I will send Lee this post with a request that she take the ad down.
NJ Spotlight should be covering critical issues in the public interest, based on facts and law, not accepting false advertising from private corporate entities like PennEast that it is covering.
[End note: let’s briefly explore those legal elements of fraud:
1. the ad’s term “approved” and the implications of regulatory “approval” clearly are a “material representation”;
2. the material representation is clearly false by omission; NJ DEP has not issued approvals;
3. the PennEast representative that wrote and paid for the false ad “knew it was false or made it recklessly without any knowledge of the truth and as a positive assertion” – that is obvious from the facts of the PennEast NJ DEP review process ad the public opposition to same.
4. proving intent by PennEast that Spotlight readers of the false ad would act on it is more complex. But clearly, if the public thinks that PennEast has been “approved” they would be far less likely to continue opposition to a “done deal” or fait accompli.
5. Some members of the public are likely to act in reliance on the false ad and abandon opposition to the pipeline. Less public opposition makes government approvals more likely.
6. The public would suffer if the opposition wanes and the pipeline is approved.
The elements of fraud are either obvious or very likely to be found in PennEast’s own corporate documents. Legal discovery process would open that can of worms. ~~~ end note.]
[Update: Here is NJ Spotlight editor Lee Keough’s response – can she possibly be that naive?
Bill:
It has been approved by FERC and if you click on the ad, that’s what they say. We’ve written multiple times that it still needs final approval DRBC and the state. Lee
Failure by PennEast to disclose material facts while using identical terms that imply material falsehoods (i.e. using the term “approved”) is clearly a dishonest tactic intended to deceive readers. PennEast has significant interests in creating a false public impression that they have received all necessary approvals, if only to deflate and divert the opponents.
Similarly, NJ Spotlight’s claim that they’ve “written multiple times” about the 401 WQC issue is flat out false.
Yes, they have written about the pipeline “still needs final DRBC approval and the state” several times, but that coverage was as vague, uniformed, and unhelpful as Lee’s use of language in her reply to me above.
What does “the state” mean? Who at the state? what approval? what are the NJ science, legal, and policy issues? What have other state’s done? What does the US Supreme Court say? How would that law apply to NJ Surface Water Quality Standards and all the C1 streams that would be crossed by the pipeline?
NJ Spotlight’s editor can’t be precise?
Lee Keogh is following the same flawed approach used by Rethink Energy NJ – ambiguous use of language to dodge the issues. Weasel words politicians love.
Spotlight wrote about the WQC issue once, and the story was not well done. They had multiple opportunities to write about the issue and never did – not once. ~~~ end update]
[Update #2 – an astute reader notes: “It’s false Even under FERC it is only a conditional approval ,they do not have final approval.” ~~~ end update]