A coalition of business associations led by the Chamber of Commerce is asking the U.S. Supreme Court to block enforcement of California's climate disclosure laws amid ongoing legal challenges.
The group seeks to halt enforcement of Senate Bill 261 (SB 261) and related SB 253 while it fights the denial of a preliminary injunction by the district court in the U.S. Court of Appeals for the Ninth Circuit; and potentially in the High Court should the Ninth Circuit affirm denial of the injunction.
As a reminder:
- SB 253 (the Climate Corporate Data Accountability Act) requires companies with over $1 billion in total annual revenues doing business in California to publicly disclose Scope 1 and 2 greenhouse gas emissions in conformance with the Greenhouse Gas Protocol beginning sometime in 2026 and Scope 3 emissions beginning sometime in 2027. The statute requires third-party assurance and provides for administrative penalties for noncompliance.
- SB 261 (the Climate-Related Financial Risk Reporting Law) requires companies with over $500 million in total annual revenues doing business in California to publish climate-related financial risk reports, aligned with the Task Force on Climate-related Financial Disclosures framework or an equivalent that incorporates it, and to disclose measures for risk mitigation and adaptation.
The business coalition argues that SB 261 and SB 253 “compel thousands of companies across the Nation to speak on the deeply controversial topic of climate change,” in a “state-prescribed” manner in violation of the First Amendment. Their First Amendment arguments largely reiterate the positions they asserted in the district court and the Ninth Circuit, with the emergency filing emphasizing the looming reporting deadlines and irreparable-harm considerations. The applicants contend that the mandated disclosures are not typical commercial speech, because they are "standalone statements on controversial climate matters—untethered to products or transactions," and that even if treated as commercial speech, California’s asserted interests (preventing deception, reducing emissions, and promoting transparency) are speculative or insufficient, and the laws themselves are not narrowly tailored. The applicants further argue that the disclosures are not purely factual or uncontroversial and are unnecessary to prevent deception. Finally, they claim the laws are overbroad, converting voluntary frameworks into “one-size-fits-all speech mandate[s]” that embed a viewpoint.
The applicants stress that they will suffer irreparable harm from the compelled speech, noting SB 261's looming January 1, 2026, reporting deadline and the fact that the Ninth Circuit will not hear oral arguments on the matter until January 9, 2026; after the deadline has passed. They also cite unrecoverable significant compliance costs already being incurred (as a result of their members having to hire consultants, build emissions-accounting systems, and prepare the required narrative and data reports). Finally, they assert that no urgent public interest supports enforcing these novel, never-before-effective laws where benefits are speculative and the state has repeatedly delayed (and missed its own deadlines for) their implementation.
The Supreme Court could rule on the emergency application, set it for argument, or convert it to certiorari before judgment with an accompanying injunction. In parallel, the Ninth Circuit will hear arguments on January 9, 2026. Businesses that are covered by SB 261 or SB 253 (particularly those who are members of the applicant organizations) should continue to monitor developments closely given the proximity of the SB 261 reporting deadline.
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