ExxonMobil is challenging California’s greenhouse gas (GHG) emissions reporting laws as a violation of the company’s right to free speech. The company is asking the court to block implementation of SB 253 and SB 261, scheduled to take effect in 2026. Exxon filed the lawsuit in the U.S. District Court for the Eastern District of California on October 24, 2025.
Exxon argued that the laws require the company to “serve as a mouthpiece for ideas with which it disagrees” with the goal of the law to “embarrass” large companies that the state “believes are uniquely responsible for climate change into ‘tak[ing] meaningful steps to reduce GHG emissions.’”
Exxon also argued that the laws compel the company to “trumpet California’s preferred message even though ExxonMobil believes the speech is misleading and misguided.” The company said it already reports its global emissions and climate risks and “no California official has ever suggested those disclosures are misleading or incomplete.”
The suit also stated that SB 261 would require it to speculate “about unknowable future developments and to publicly disseminate that speculation on its website.”
SB 253 and SB 261, enacted in 2023, are know as the Climate Accountability Package. SB 253 requires companies with revenues of more than $1 billion to report their GHG emissions related to both operations and their supply chain starting in 2026. SB 261 requires companies with annual revenue of more than $500 million and that do business in California to disclose publicly their company’s climate-related financial risks and plan to address them.
In a separate legal challenge, a coalition of business groups filed a lawsuit challenging SB 253 and SB 261 in 2024.