Ten States Ask Court to Invalidate SEC’s New Climate Rule
[Stay on top of transportation news: Get TTNews in your inbox.]
Asking how many trucks will be too many for companies to use, West Virginia Attorney General Patrick Morrisey announced his part in a 10-state coalition suing the U.S. Securities and Exchange Commission to thwart its new rule requiring companies to report greenhouse gas emissions.
Attorneys general for West Virginia, Georgia, Alabama, Alaska, Indiana, New Hampshire, Oklahoma, South Carolina, Wyoming and Virginia filed a petition for review March 6 regarding the SEC’s adoption that day of “The Enhancement and Standardization of Climate-Related Disclosures for Investors.”
In the legal fight in the 11th Circuit of the U.S. Court of Appeals in Atlanta, the states intend to demonstrate the SEC “exceeds the agency’s statutory authority and otherwise is arbitrary, capricious, an abuse of discretion, and not in accordance with law. Petitioners thus ask that this court declare unlawful and vacate the commission’s final action.”
Morrisey predicted the new SEC rule will “make it virtually impossible for companies to calculate how their environmental impact is material. How is a company supposed to know if greenhouse gas emission will affect its finances? How many trucks are going to be too many?”
Attorney General Morrisey Briefs Media on a Major Legal Development from WV Attorney General on Vimeo.
The new SEC rule spans 886 pages, amending its powers under the Securities Act of 1933 and Securities Exchange Act of 1934, and attracted 24,000 comment letters, including more than 4,500 unique letters, voicing opinions about its proposed rule issued in March 2022.
The SEC will now require its registered companies to provide certain climate-related information in their registration statements and annual reports. Now companies are to provide information about their “climate-related risks that have materially impacted, or are reasonably likely to have a material impact on, its business strategy, results of operations, or financial condition. In addition, under the final rules, certain disclosures related to severe weather events and other natural conditions will be required in a registrant’s audited financial statements.”
The mandates take effect 60 days after the rule’s publication in the Federal Register, with phased in compliance dates depending on an individual company’s SEC filing status.
Gensler
Gary Gensler, SEC chair, said, “Over the last 90 years, the SEC has updated, from time to time, the disclosure requirements underlying that basic bargain and, when necessary, provided guidance with respect to those disclosure requirements.”
Morrisey described the SEC rule as “a backdoor move” in another attack by the Biden administration to undermine America’s energy industry.
“It actually may be one of their most egregious attempts yet,” he said. “But this time they’re not using the EPA as their tool of choice. It’s actually the Securities and Exchange Commission. And let’s be clear, that’s a financial regulator. They’re designed to look at fraud in the pricing marketplace related to securities.”
“Certainly the SEC has nothing to do with climate change or energy,” Morrisey continued. “But today, the SEC unveils a rule, unlike any before. The rule tells companies that you probably have to disclose information about their greenhouse gas emissions, even though that information is entirely unrelated to their financial status. At this isn’t just a small little thing. This requirement is very significant.”
Meghann Erhart of Relay Payments shares ways to prevent falling prey to fuel card skimming. Tune in above or by going to RoadSigns.ttnews.com.
He said the SEC rule “twists the long-standing materiality definition and applies it in a way that it’s never been applied before” that will result in companies having to report in numerous forms containing information that “doesn’t represent reasoned decision-making,” is not tied to clear statutory authority and poses serious First Amendment problems.
Morrisey contended “the SEC wants to do to private businesses what thousands of scientists cannot and that’s to determine the exact impact of greenhouse gas emissions. Now, by forcing private businesses to make these guesses, the Biden administration is once again placing its agenda onto an unwilling public by forcing unrelated federal agencies and private companies to press its anti-energy agenda. They’re trying to use these companies like they’re the puppeteer, forcing them to drive in a political agenda.”
Indiana Attorney General Todd Rokita issued a statement that his state is fighting back against the Biden administration’s efforts to weaponize the SEC that now forces companies “to compile and disclose cumbersome amounts of material related to their greenhouse gas emissions and how their activities supposedly affect climate change.”
He declared the SEC has moved beyond its traditional role as an independent federal agency that focused on enforcing laws against stock market manipulation.
Want more news? Listen to today's daily briefing above or go here for more info
“Hoosiers rightly expect the SEC to be focused on protecting investors and financial markets rather than making companies bend the knee to radical environmentalism,” Rokita said. “Companies have a legal fiduciary duty to maximize returns to shareholders. Costly ideological requirements with no proven effect only drive up the price of goods for everyday Hoosiers and reduce value for shareholders. The only winners here are big business and the radical environmentalists with a vendetta against capitalism.”
The U.S. Chamber of Commerce said it is reviewing “the rule and its legal underpinnings to understand its full impact” and would “use all the tools at our disposal, including litigation if necessary, to prevent government overreach and preserve a competitive capital market system.”
