Back in November, we wrote about the legal challenge to California Climate-related disclosure laws SB 253 and SB 261. At that time, the California Air Resources Board (CARB) won a preliminary victory against the California Chamber of Commerce and other plaintiffs looking to nullify the new disclosure laws. The Plaintiff’s case is based on three main arguments:
- compelled speech in violation of the First Amendment,
- violation of the Supremacy Clause, and
- violation of the dormant Commerce Clause.
The First Amendment claim was punted in November until adequate discovery on the issue can be completed, but the other two issues have now been dismissed in a huge win for CARB. Cooley writes about the dismissals in a recent memo:
“In November of last year, in this Order, the Federal District Court for the Central District of California denied Plaintiffs’ motion to dismiss as to that first claim (violation of the First Amendment) and granted California’s motion to deny or defer the motion for summary judgment… Now, in Chamber of Commerce v. California Air Resources Board, the Court has issued an Order granting California’s motion to dismiss and dismissing Plaintiffs’ second and third causes of action under the Supremacy Clause and dormant Commerce Clause (as invalid extraterritorial regulation).”
The court determined that standing and ripeness issues prevented plaintiffs from bringing challenges to SB 253 at this time, though that may change once the CARB promulgates specific disclosure regulations. Accordingly, the challenges against SB 253 were dismissed without prejudice, meaning that they may be brought again in the future. As for SB 261, the court split its ruling. The court found the supremacy clause argument fatally flawed and dismissed it with prejudice, meaning it may not be brought again but may be appealed. Alternatively the court determined that the interstate commerce argument could hypothetically be supported in the future and dismissed this argument without prejudice. While the litigation is far from over, CARB is making good progress and the continued survival of SB 253 and SB 261 currently looks promising. Though it is likely at least some of these findings will be appealed by the plaintiffs.
Our members can learn more about the California disclosure laws here.
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