ExxonMobil, one of the world's largest contributors to carbon emissions, has filed a lawsuit against the state of California over two climate-focused laws, arguing they violate the company's free speech rights. The lawsuit, filed in the US District Court for the Eastern District of California, seeks to block enforcement of the California Climate Accountability Package, passed in 2023.
The laws require large companies operating in California to disclose their greenhouse gas emissions and climate-related financial risks, or face annual penalties. Exxon argues that this would force it to 'serve as a mouthpiece for ideas with which it disagrees.' The company already reports emissions voluntarily but uses a different methodology, and claims the state's preferred framework sends a 'counterproductive message' about responsibility for climate change.
Exxon also contends that the requirement to report global emissions should only apply to activities within California, as most of its operations are outside the state. Additionally, it argues that disclosing climate risks to business operations would force it to speculate about 'unknowable future developments' and conflicts with federal securities laws.
California Governor Gavin Newsom's spokesperson, Tara Gallegos, called the lawsuit 'truly shocking' and expressed confidence in the laws, which have already been upheld in court. Supporters say the rules help prevent greenwashing, with environmental attorney Hollin Kretzmann noting they 'pull back the curtain on the biggest climate destroyers.'
Previous legal challenges by business groups, including the US Chamber of Commerce, were denied a motion to block the laws, but the case continues with a trial expected in October 2026. The enforcement of the laws is set to begin in 2026.
