Appeals Court Slows California’s Push for Climate Disclosure Mandates

A federal appeals court has temporarily stopped one of California’s most aggressive climate-disclosure laws, giving companies across the country a brief reprieve from costly new regulatory mandates. The paused measure would have required large businesses to report every two years on how climate change could financially impact their operations. The rule was scheduled to take effect in January and was widely viewed as one of the broadest and most intrusive climate-risk reporting schemes in the nation.

The U.S. Chamber of Commerce, which led the challenge, argues that California’s broad disclosure rules violate the First Amendment by forcing companies to make statements they may not agree with. More importantly, the Chamber warns that the laws will impose huge compliance costs on businesses, especially those with complex supply chains. These burdens hit hardest on industries like energy, transportation, manufacturing, and agriculture, which already operate in some of the most heavily regulated environments in the country.

In its ruling, the appeals court agreed to pause the climate risk reporting requirement but left the emissions reporting mandate intact for now. The Chamber had also asked the U.S. Supreme Court to intervene, but withdrew its emergency request after the lower court’s partial stay.

The court’s decision underscores growing concerns about California’s efforts to rewrite national climate policy through single-handed state-level regulation. California’s mandates ignore economic realities, strain supply chains, and duplicate or conflict with federal reporting requirements. As the Chamber noted, no single state should have the power to impose massive new costs on companies operating nationwide.