(Bloomberg) -- Exxon Mobil Corp.'s clash with Treasury Secretary Steven Mnuchin is escalating in a Texas court with the energy giant claiming government interpretation of sanctions regulations is too broad.
The dispute relates to a 2014 deal Exxon struck with Moscow-based Rosneft OAO while the company's Chief Executive Officer Igor Sechin was on the Treasury's list of sanctioned Russian nationals. The Treasury Department fined Exxon $2 million over the 2014 invasion of Ukraine..
Exxon claims the deal was with Rosneft alone and had nothing to do with Sechin's personal property. If the fine is upheld, any deal with Rosneft could violate the rules, whether or not Sechin signed a document, even though the Russian company isn't sanctioned, Exxon said in a filing in federal court in Dallas.
The government's “‘benefits' theory provides no principled place to draw the line,” Exxon said.
That “benefit” would result in a violation even if Sechin gave internal approval for a contract, helped draft a contract, or instructed a subordinate to sign it, Exxon said. That would lead to “absurd” results, the company added.
Each side in the lawsuit has asked the judge to rule in its favor without a trial.
Read More: Exxon to Challenge Treasury Finding It Violated Russia Sanctions
To contact the reporter on this story: Erik Larson in New York at elarson4@bloomberg.net
To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Joe Schneider, Steve Stroth
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