Issue - August 12, 2025

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Good morning. It’s Tuesday, August 12, and this week’s ESG Litigation Weekly covers New Jersey’s record $2 billion PFAS settlement with DuPont, Chemours, and Corteva, a shareholder lawsuit against Tesla and Elon Musk over Robotaxi safety risks, the Italian competition authority’s €1 million fine against Shein for misleading green claims, and more.

⚖️ ESG Casefile

New Jersey Secures $2 Billion PFAS Settlement With DuPont, Chemours, and Corteva
New Jersey has reached a record $2 billion settlement with DuPont, Chemours, and Corteva over decades of per- and polyfluoroalkyl substances (PFAS) and other pollutants from four industrial sites. Pending court approval, the deal includes $875 million for natural resource damages, a $1.2 billion remediation fund, and a $475 million reserve fund to safeguard taxpayers if obligations are not met. It resolves the state’s 2019 Chambers Works lawsuit and all related legacy contamination claims, marking the largest environmental settlement ever achieved by a single state.
🔗 Read more → ABC News (US)

BHP and Vale Offered $1.4 Billion to Settle UK Class Action Over Brazil Dam Disaster
BHP and Vale proposed a $1.4 billion settlement to resolve a £36 billion UK class action arising from the 2015 Mariana dam collapse in Brazil, which killed 19 people and caused widespread environmental damage. According to the Financial Times, the offer discussed at a June meeting in New York earmarked about $800 million for victims and $600 million for legal fees, but claimants sought closer to $3 billion. The London trial concluded in March and judgment remains pending.
🔗 Read more → Financial Times

Judge Dismisses Charleston’s Climate Lawsuit Against Oil Companies
A South Carolina judge dismissed Charleston’s lawsuit against major oil and gas companies, finding the city’s claims over climate-related deception were essentially about greenhouse gas emissions and therefore governed by federal, not state law. The suit, filed in 2020, alleged the companies ran a disinformation campaign to downplay climate risks and sought funds for adaptation projects under state tort and consumer protection laws. Judge Roger M. Young’s ruling echoed other defense wins, warning that such cases could create a patchwork of conflicting legal obligations and that remedies belong with federal political branches. Charleston is weighing whether to appeal.
🔗 Read more → New York Times

Tesla and Elon Musk Face Shareholder Lawsuit Over Robotaxi Safety Risks
Tesla shareholders filed a proposed class action accusing Elon Musk and the company of securities fraud for allegedly concealing major safety risks tied to its self-driving Robotaxi program. The complaint followed a June pilot test in Austin that reportedly showed unsafe driving behaviors, prompting a federal investigation and a 6.1% drop in Tesla’s share price over two days. Shareholders claim Musk and Tesla overstated the technology’s readiness and potential, inflating market value, while the company also faces legal fallout from a recent jury verdict finding it partly liable for a 2019 fatal crash involving its self-driving software.
🔗 Read more → The Guardian

Kmart Faces Court Action Over Alleged Links to Forced Labor in Supply Chain
The Australian Uyghur Tangritagh Women’s Association (AUTWA) has asked the Federal Court to order Kmart to produce documents substantiating claims that its products are free of slavery and forced labor. The case, brought under consumer law, aims to determine whether Kmart engaged in misleading or deceptive conduct in marketing itself as an ethical and sustainable company. The plaintiffs allege that at least two garment suppliers are linked to Uyghur forced labor. Kmart denies the claims, citing its long-standing Ethical Sourcing Program, while human rights advocates say the case highlights weaknesses in Australia’s Modern Slavery Act, which mandates reporting but not action.
🔗 Read more → ABC News (Australia)

Judge Blocks Trump Administration from Redirecting $4 Billion in Disaster Mitigation Funds
A federal judge in Boston granted a preliminary injunction preventing the Trump administration from reallocating $4 billion earmarked for the Building Resilient Infrastructure and Communities (BRIC) program. Brought by 20 Democrat-led states, the lawsuit argued the Federal Emergency Management Agency (FEMA) lacked the authority to end the program and redirect the funds that Congress had allocated to strengthen infrastructure against storm and climate risks. Judge Richard G. Stearns found the states had shown both legal merit and public interest, noting that ending the program could jeopardize critical projects, particularly in rural areas. FEMA said it was only evaluating the program, but the court concluded its actions suggested an imminent shutdown.
🔗 Read more → The Associated Press

🏛️ Regulatory Developments

South Africa Plans Strict Penalties for Exceeding Carbon Budgets
South Africa has proposed regulations that would require companies emitting more than 30,000 tons of greenhouse gases a year to stay within set carbon budgets, with violations carrying fines of up to ZAR 10 million and prison terms of up to 10 years for repeat offenses. Expected to take effect in January 2026, the rules would apply to nearly all sectors and are intended to help the country cut coal reliance and reduce its standing as one of the most carbon-intensive G20 economies. While the carbon tax remains low at about $13 per ton, officials say the measures will help prepare industry for global carbon border tariffs.
🔗 Read more → Bloomberg

FCA Review Finds Climate-Reporting Challenges, Plans for Simpler Framework
The UK Financial Conduct Authority’s (FCA) review of climate disclosures by asset managers, life insurers, and FCA-regulated pension providers found that its TCFD-aligned rules have improved consideration of climate risks and increased transparency. Firms, however, reported challenges such as complex disclosures for retail investors, difficulty providing forward-looking data, and overlapping sustainability reporting requirements. The FCA plans to streamline its framework, improve usability for different audiences, and align with international standards while maintaining effective oversight.
🔗 Read more → FCA

Brazil Eases Environmental Licensing but Retains Key Protections
President Luiz Inacio Lula da Silva has signed a bill to streamline Brazil’s environmental licensing process, while vetoing or altering 63 of its nearly 400 provisions to safeguard Indigenous and Quilombola rights and preserve licensing integrity. The law, supported by agribusiness and criticized by environmentalists as the “Devastation Bill,” shifts more licensing authority to states and municipalities. Lula’s administration will propose a new “Special Environmental License” to fast-track strategic projects and address legal gaps created by the vetoes.
🔗 Read more → Reuters

EBA Issues No-Action Letter on ESG Disclosure Enforcement
The European Banking Authority (EBA) has issued a no-action letter advising EU regulators not to prioritize the enforcement of certain ESG Pillar 3 disclosure templates until amended technical standards take effect. The move aims to address legal and operational uncertainties created by evolving sustainability reporting rules under the European Commission’s Omnibus package. The EBA also updated its ESG risk dashboard, noting stable risk trends across EU and EEA banks, and will adjust future dashboards to align with the no-action guidance.
🔗 Read more → EBA

Indian Parliamentary Panel Urges Creation of ESG Oversight Body
India’s Standing Committee on Finance has called for the establishment of a dedicated ESG oversight body to combat greenwashing, enforce penalties for fraudulent ESG claims, and provide sector-specific guidance. The panel recommended statutory amendments to the Companies Act, 2013, to make ESG objectives part of directors’ fiduciary duties, along with stronger oversight systems for corporate social responsibility activities. It also urged measures to support small and medium enterprises, accelerate enforcement, and strengthen financial crime investigations.
🔗 Read more → The Economic Times

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🧼 Greenwashing Watch

Italian Regulator Fines Shein €1 Million for Misleading Green Claims
The Italian Competition Authority fined Infinite Styles Services Co. Ltd. (Shein’s EU operator) €1 million for using vague, exaggerated, and misleading environmental claims in promoting its clothing products. The regulator found that marketing for initiatives such as #SHEINTHEKNOW and the evoluSHEIN line overstated recyclability and sustainability benefits, while emissions reduction pledges were presented without clarity and contradicted by rising greenhouse gas emissions in recent years. The authority stressed that Shein’s ultra-fast fashion model carries a heightened responsibility due to its significant environmental impact.
🔗 Read more → Autorità Garante della Concorrenza e del Mercato

How to Spot and Avoid Greenwashing
With consumer demand for sustainable products on the rise, experts warn that many companies use vague claims, nature imagery, or unverified labels to market goods as environmentally friendly without real impact. Red flags include generic terms like “eco-friendly,” the absence of credible third-party certification, and exaggerated single-attribute claims that ignore broader environmental effects. Shoppers are advised to seek verified ecolabels, review supply chain transparency, and consider a product’s full life cycle before buying.
🔗 Read more → CNN

💡 Insight of the Week

Judicial Action Emerges as a Top Driver of Sustainability Impact
A global survey of sustainability experts found that judicial action is now seen as one of the most powerful strategies for driving sustainability outcomes, a view reinforced by the International Court of Justice’s July advisory opinion declaring a clean, healthy, and sustainable environment a fundamental human right. The opinion reframed climate action as a legal obligation, finding that states failing to meet their commitments breach international law, and gave fresh momentum to the more than 3,000 climate lawsuits pending worldwide. Experts also ranked education, policy advocacy, and media scrutiny among the most impactful civil society strategies, while NGO campaigns and public protests were seen as less effective in achieving systemic change.
🔗 Read more → Trellis

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