Supreme Court Considers Challenge to California Climate Disclosure Laws

WASHINGTON  – The U.S. Chamber of commerce and other business groups urged the Supreme Court on Friday to block new California laws that will require thousands of companies to disclose their emissions and their impacts on climate change.

One of the laws is due to take effect on Jan. 1, and the emergency appeal asks the court to put it on hold temporarily.

Their lawyers argue the measures violate the 1st amendment as the state would be forcing companies to speak on its preferred topic.

“In less than eight weeks, California will compel thousands of companies across the nation to speak on the deeply controversial topic of climate change,” they said in an appeal that also spoke for the California Chamber of Commerce and the Los Angeles County Business Federation.

They say the two new laws would require companies to disclose the “climate-related risks” they foresee and how their operations and emissions contribute to climate change.

“Both laws are part of California’s open campaign to force companies into the public debate on climate issues and pressure them to alter their behavior,” they said. Their aim, according to their sponsors, is to “make sure that the public actually knows who’s green and who isn’t.”

One law, Senate Bill 261, will require several thousand companies that do business in California to assess their “climate-related financial risk” and how they may reduce that risk. A second measure, SB 253, which applies to larger companies, requires disclosure of emissions across their entire supply chains.

Key Takeaways

• First Amendment Challenge: Business groups claim the California laws violate the First Amendment by compelling speech on a controversial topic.
• Disclosure Requirements: The laws require companies doing business in California to disclose climate-related financial risks and emissions data.
• Scope of Laws: SB 261 impacts several thousand companies, while SB 253 focuses on larger corporations and supply chain emissions.
• Emergency Appeal: The U.S. Chamber of Commerce and others have filed an emergency appeal with the Supreme Court to temporarily halt the laws’ implementation.

FAQ

What is the core argument against these California laws?

The primary argument is that the laws infringe upon the First Amendment rights of companies by forcing them to publicly disclose details and opinions on a politically charged issue – climate change.

Which companies are affected by SB 261?

SB 261 applies to several thousand companies that conduct business in California, requiring them to assess and report on climate-related financial risks.

What does SB 253 require?

SB 253 mandates that larger companies disclose emissions data throughout their entire supply chains, providing a broader picture of their climate impact.

What is the current status of the legal challenge?

An emergency appeal has been filed with the Supreme Court, seeking a temporary halt to the laws’ implementation while the legal challenge proceeds.