Exxon sues California over climate laws, alleging free speech violations | ExxonMobil
Exxon, an oil company consistently among the world’s top contributors to global carbon emissions, is suing the state of California over two climate-focused state laws, arguing the rules violate the company’s right to free speech.
The 2023 laws, collectively known as the California Climate Responsibility Package, would require major companies doing business in the state to disclose both their planet-warming carbon emissions and their climate-related financial risks or face annual penalties.
The legislation would therefore force Exxon “to serve as a spokesman for ideas with which it disagrees.” the lawsuit saysIt was filed with the U.S. district court for the eastern district of California on Friday.
Asked for comment, Exxon referred the Guardian to the case. It was not immediately possible to comment on the state of California.
Tara Gallegos, a spokeswoman for California governor Gavin Newsom, told the New York Times that it was “truly shocking that one of the biggest polluters on the planet opposes transparency,” adding that the laws “have already been upheld in court and we continue to rely on them.”
Exxon is asking the court to block implementation of the laws, which are scheduled to begin in 2026. The company already voluntarily reports emissions and climate risks using different methodologies, the lawsuit said.
But the law would force the company to adopt the state’s preferred frameworks for emissions and risk reporting, which is “misleading and inefficient,” the lawsuit says.
To calculate its emissions, Exxon uses a method created by the nonprofit global oil and gas industry association Ipieca. Created in 1974 Allowing the UN environmental group to engage with polluting industries. But under one of two laws in California, a methodology known as the Greenhouse Gas Protocol, developed by the World Resources Institute research group and the World Business Council for Sustainable Development business network, would have to be used.
This framework sends “an unproductive message that large corporations are solely responsible for climate change, no matter how efficiently they meet society’s demand for energy, goods and services,” the lawsuit states.
California law also requires companies to report their global emissions footprint. But Exxon argues that the rule should apply only to emissions from company operations within California because the vast majority of Exxon’s business operations occur outside the state.
The second 2023 California law, which Exxon opposes, requires companies to disclose the threat climate change poses to their business operations and how they plan to address it. Exxon argued that this would require speculation “about unknown future developments.”
He also argued that the law conflicts with existing federal securities laws, which currently govern what public companies must disclose regarding financial and environmental risks.
Taken together, the lawsuit argues that the two laws are overreach by California officials. Exxon said the laws were intended to “shape public opinion and embarrass private parties unpopular with the State.”
Supporters of California’s rules say they discourage companies from greenwashing.
“Disclosure requirements will really pull back the curtain on the biggest climate destroyers in the oil industry,” Hollin Kretzmann, a senior lawyer at the environmental advocacy group Center for Biological Diversity, told the Guardian after these rules were adopted.
Last year, business interests including the U.S. Chamber of Commerce, California Chamber of Commerce and American Farm Bureau Federation sued California over the same two laws. a judge rejected A motion to block the laws was made by business groups, but the case is still ongoing with a hearing date expected in October 2026.
The U.S. Securities and Exchange Commission was also working to implement new federal climate disclosure rules and was nearing completion toward the end of Joe Biden’s tenure in the White House. These rules have also faced legal challenges; In March, the agency voted to end legal defense of the rules.
