9th Circuit Court Blocks California Climate Disclosure Laws
The 9th US Circuit Court of Appeals blocked California from enforcing laws requiring companies to disclose climate-related financial risks and indirect emissions.
A three-judge panel of the 9th US Circuit Court of Appeals blocked California from enforcing two first-of-its-kind climate disclosure laws. The court ruled that the Climate-Related Financial Risk Act (Senate Bill 261), which required companies with over $500 million in annual revenue to disclose climate-related financial risks, likely violates the First Amendment by compelling value-laden judgments on a politically fraught subject.
The court also blocked portions of the Climate Corporate Data Accountability Act (Senate Bill 253) concerning the reporting of indirect emissions from value chains for businesses with over $1 billion in revenue. However, the ruling allows California to continue enforcing requirements for large companies to report their own direct greenhouse gas emissions and emissions from the energy they consume.
The decision follows a lawsuit filed by the US Chamber of Commerce, the American Farm Bureau Federation, and various California business groups. These plaintiffs argued that the laws imposed excessive costs and violated free speech protections. The case has been returned to the US District Court in Los Angeles following the appeals court's intervention.
