Simpson Thacher Sustainability And ESG: Regulatory Update – January 2026

Practice News:

• An Alert discussing developments relating to California climate disclosure laws (discussed below) was published on December 10.

Americas

Ninth Circuit Court Hears Oral Arguments in Lawsuit Challenging California Climate Disclosure Laws

On January 9, the U.S. Court of Appeals for the Ninth Circuit heard oral argument following the granting of a temporary preliminary injunction on Senate Bill 261 (the Climate-related Financial Risk Act) in November. Arguments focused chiefly on whether the compelled disclosures required under the statutes can be considered commercial speech, and a decision, which will also cover Senate Bill 253 (the Climate Corporate Data Accountability Act) is expected this month. Under an Enforcement Advisory issued by the California Air Resources Board (CARB), enforcement of SB 261 is currently suspended pending the appeal, but the public docket for reports remains open. CARB will hold a public hearing on February 26 to