ExxonMobil has filed a lawsuit against the state of California, challenging two recently enacted laws that require large corporations to publicly disclose their greenhouse gas emissions and climate-related financial risks.
The complaint, lodged in the U.S. District Court for the Eastern District of California, argues that Senate Bills 253 and 261 infringe on the company’s First Amendment rights by compelling it to “serve as a mouthpiece for ideas with which it disagrees.” Exxon is seeking an injunction to prevent the state from enforcing the measures.
The oil major contends that California’s disclosure frameworks are “misleading and counterproductive”, asserting that it already publishes emissions and climate risk data voluntarily. Exxon further claims that SB 261 conflicts with existing federal securities laws governing financial and environmental disclosures.
Passed in 2023, the two laws form part of California’s wider efforts to lead on climate governance. SB 253 mandates that public and private companies operating in the state with annual revenues exceeding $1 billion report both direct and indirect emissions from 2026. SB 261 requires firms with revenues above $500 million to outline their exposure to climate-related financial risks and mitigation strategies.
While the legislation has been supported by corporations such as Apple, Ikea and Microsoft, it has faced opposition from business groups including the U.S. Chamber of Commerce and the American Farm Bureau Federation, who describe the rules as overly burdensome.
“The First Amendment bars California from pursuing a policy of stigmatization by forcing ExxonMobil to describe its non-California business activities using the state’s preferred framing,” the company stated in its filing.
The California Department of Justice and the California Air Resources Board have yet to comment on the case.
