SEC Asks 8th Circuit to Issue a Decision on 2024 Climate Rules
The SEC asked the Court of Appeals for the Eighth Circuit to issue a decision on the agency's 2024 climate disclosure rule.
The request comes after the Court requested the SEC provide a status report as to whether it plans to withdraw or rewrite the regulations. In the Status Report, the SEC said it would not reconsider or revise the rule, despite previously withdrawing its defense in the pending litigation before the Court.
The rule, formally known as The Enhancement and Standardization of Climate-Related Disclosures for Investors, was adopted in March 2024. It required public companies to report climate-related risks and certain greenhouse gas emissions as part of their regular filings. A coalition of states led by Iowa challenged the rule, arguing that the SEC exceeded its legal authority and that the rule imposed burdens beyond what the law allows.
In the Status Report, the SEC asked the Court to end the hold on the case and issue a ruling. The SEC argued that the issues had been fully briefed by all parties, including states and groups that stepped in to defend the rule. The SEC acknowledged that most of its Commissioners currently believe the agency lacked statutory authority to issue the rule. However, the SEC emphasized that only the Court could make the final determination.
Commissioner Caroline A. Crenshaw criticized the SEC's filing, calling it "wholly unresponsive" to the court's direct question about whether the SEC would enforce the rule if the petitions were denied. Ms. Crenshaw argued that the SEC effectively admitted it would not: "The unspoken truth under this Commission is that the answer is 'no.'" She noted that three of the four current Commissioners had publicly criticized the rule and withdrawn the SEC from its legal defense. Ms. Crenshaw dismissed the SEC's argument that commenting on its future intentions would amount to "prejudging" policy decisions. She countered that there was nothing left to prejudge because the majority had already made up its mind.
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