BizFed Central Valley sues California over climate-reporting laws

Two laws signed by Governor Newsom last year violate the First Amendment, business groups argue.

BizFed Central Valley is part of a group challenging two California climate-related laws. 

The Central Valley business organization joins with the U.S. Chamber of Commerce, the American Farm Bureau Federation, the California Chamber of Commerce and other groups to file the lawsuit against California. 


The backstory: Last year California Gov. Gavin Newsom signed Senate Bill 253 and Senate Bill 261 into law, which are called the Climate Accountability Package. 

  • SB 253 requires the California Air Resources Board to develop regulations requiring businesses with annual revenues over $1 billion to disclose their greenhouse gas emissions. 
  • SB 261 requires businesses with annual revenue over $500 million to develop reports on their climate-related financial risks. 

The big picture: The business groups argue that reporting on emissions across their supply chain – which includes indirect emissions no matter where they occur – is a near-impossible task to calculate. 

  • The laws attempt to impose what is essentially a national standard, the groups argue, by applying to companies across the nation and worldwide as long as they have even minimal operations in California. 
  • The groups are suing California on the basis that the laws violate the First Amendment, which bars California from compelling a business to engage in subjective speech. 
  • California is also allegedly violating the federal Clean Air Act, according to the lawsuit, which supersedes California’s authority to regulate emissions in other states. 

What they’re saying: “Historic regulatory overreach calls for historic advocacy action,” BizFed said in a statement. “This lawsuit marks the first time BizFed’s Board of Directors has voted to front legal action challenging climate-related laws. We signed on as a co-plaintiff in this case because the new laws in question compel speech in violation of the First Amendment. Both laws go far beyond the federal government’s proposed climate disclosure rules.” 

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