Court Upholds California Climate Disclosure Laws—for Now

On August 13, 2025, the U.S. District Court for the Central District of California denied the U.S. Chamber of Commerce’s motion for a preliminary injunction seeking to halt enforcement of SB 253 (emissions disclosure) and SB 261 (climate-related financial risk reporting). The ruling keeps both laws on track for their first compliance deadlines in 2026.

The court found that both SB 253 and SB 261 regulate commercial speech.  However, the Court concluded that the plaintiffs had not shown a likelihood of success on the merits of their facial First Amendment challenges to either statute and denied the request for preliminary injunction. 

Main takeaways. 
1. Compliance timelines remain intact:

• SB 253: Scope 1 and 2 disclosures in 2026; Scope 3 disclosures in 2027.
• SB 261: Climate-related financial risk report due by January 1, 2026.

2. In-scope companies may want to consider the following:

• Stay the course – Continue building emissions measurement systems, supplier engagement processes, assurance frameworks, and governance structures to meet first-reporting deadlines.
• Monitor litigation developments – It is unclear whether plaintiffs will appeal or proceed directly to trial, and whether any appeal—if successful—would provide relief before reporting deadlines.
• Review and consider involvement in CARB rulemaking – CARB will host a virtual public workshop on August 21, 2025 to discuss key definitions, minimum reporting requirements under SB 261, and the regulatory development timeline. This is an opportunity for legal and compliance teams to seek clarity, propose workable interpretations, and help shape final rules before they are locked in.