Issue - July 7, 2026

Good morning. It’s Tuesday, July 7, and this week’s ESG Litigation Weekly covers the U.S. Justice Department’s statement of interest in Michigan’s antitrust case against major oil companies, the European Commission’s revised sustainability reporting standards, New Zealand’s proposed bar on emissions-related tort claims, and more.

DOJ Challenges Michigan’s Antitrust Claims Against Oil Companies
The U.S. Department of Justice (DOJ) filed a statement of interest supporting key arguments raised against Michigan’s lawsuit alleging that major oil companies conspired to delay renewable energy development and raise consumer energy costs. DOJ argued that federal antitrust rules bar much of Michigan’s federal antitrust damages claim because the state and most residents purchased energy through intermediaries rather than directly from the defendants. It also contended that Michigan’s state-law claim for climate-related damages is preempted because interstate greenhouse gas emissions are governed by federal law. DOJ took no position on the truth of Michigan’s allegations or the case’s ultimate outcome.
🔗 Read more → U.S. Department of Justice (Statement of Interest), Michigan AG (Court Filing)

Environmental Groups Challenge Approval of California Rail Hub
A coalition of environmental and community groups sued the City of Barstow seeking to set aside approval of BNSF’s planned 5,000-acre Barstow International Gateway rail and logistics complex. The petition alleges the city’s environmental review violated the California Environmental Quality Act (CEQA) by inadequately analyzing and mitigating air pollution, greenhouse gas emissions, diesel use, noise, water, habitat, environmental justice, and cumulative and growth-inducing impacts. It also claims the final environmental impact report added significant new information without recirculation and failed to consider feasible zero-emission alternatives. The groups seek vacatur of the approvals and injunctive relief pending CEQA compliance.
🔗 Read more → Earthjustice (Press Release, Court Filing)

NGOs Seek Disclosure on TotalEnergies’ Nigeria Divestment
Four organizations commenced pre-trial proceedings in France seeking documents concerning TotalEnergies’ proposed sale of its 10% non-operating interest in the Renaissance oil and gas joint venture in Nigeria to Vaaris. Friends of the Earth France, Hawkmoth, HEDA Resource Centre and Social Action say the transaction terms remain unclear, including whether safeguards address pollution remediation and compensation for affected Niger Delta communities. They seek the documents under Article 145 of the French Code of Civil Procedure to assess the company’s compliance with France’s Duty of Vigilance Law. The transaction remains subject to Nigerian regulatory approval.
🔗 Read more → Friends of the Earth France (Press Release)

Federal Judge Blocks Indiana Proxy Adviser Disclosure Law
An Indiana federal judge granted preliminary injunctions preventing the state from enforcing HB 1273 against Institutional Shareholder Services (ISS) and Glass Lewis. The law would require proxy advisers recommending votes against company management either to provide a specified written financial analysis or disclose that no such analysis was used. The court found the firms likely to succeed on their First Amendment claim because the statute burdens anti-management recommendations while leaving pro-management advice unrestricted. The ruling follows preliminary injunctions against similar proxy-adviser laws in Kansas and Texas. The constitutional challenges remain pending.
🔗 Read more → Court Order via Justia, ISS STOXX (Statement)

European Commission Adopts Simplified ESRS and Voluntary Standard
The European Commission adopted delegated acts revising the European Sustainability Reporting Standards (ESRS) and establishing a voluntary sustainability reporting standard for smaller companies outside mandatory CSRD reporting. The revised ESRS, part of the Omnibus I simplification package, reduce mandatory datapoints by more than 60% and total datapoints by more than 70%, while adding flexibilities on materiality, value-chain information, anticipated financial effects, and reporting boundaries. The revised ESRS are expected to apply from financial years beginning January 1, 2027, once the scrutiny period is complete, with optional use for 2026. The voluntary standard creates a reference framework and value-chain cap for sustainability information requests to smaller value-chain companies.
🔗 Read more → European Commission (Press Release, Revised ESRS Delegated Act, Voluntary Standard Delegated Act)

EU Regulators Consult On Simplifying Taxonomy Disclosures
Europe’s three financial supervisory authorities opened parallel consultations on simplifying EU Taxonomy disclosures. The European Securities and Markets Authority (ESMA) proposes limiting the mandatory operational expenditure (OpEx) KPI to research and development, with an optional OpEx+ metric for green procurement. The European Banking Authority (EBA) is considering eliminating or narrowing banks’ fees-and-commissions and trading-book KPIs, and reducing investment firms’ “other services” KPI. The European Insurance and Occupational Pensions Authority (EIOPA) proposes narrowing and renaming insurers’ underwriting KPI, removing the combined insurance ratio, and exploring a future Green Insured Activities KPI. The consultations also examine whether adding counterparties’ OpEx to financial-sector KPIs would increase complexity for limited value. Comments are due August 12, 2026.
🔗 Read more → ESMA (Press Release, Consultation Paper), EBA (Press Release, Consultation Paper), EIOPA (Press Release, Consultation Paper)

New Zealand Bill Would Bar Emissions-Related Tort Claims
New Zealand’s Parliament is considering legislation that would prevent any person, including the Crown, from being held liable in tort for climate-change effects linked to greenhouse gas emissions. The proposed bar would cover direct and indirect emissions, conduct occurring inside or outside New Zealand, and proceedings not finally determined when the law takes effect. It would expressly apply to the pending Smith v Fonterra case, which the Supreme Court allowed to proceed to trial in 2024. Public submissions on the bill close on July 13, 2026.
🔗 Read more → New Zealand Government (Press Release), New Zealand Parliament (Public Submissions), New Zealand Legislation (Climate Change Response (Tort Liability) Amendment Bill)

New Zealand Proposes Adopting IFRS S2 for Climate Reporting
New Zealand’s External Reporting Board (XRB) launched consultation on a draft roadmap to introduce NZ IFRS S2 based on IFRS S2 and climate-relevant requirements from IFRS S1. The proposed standard would seek international alignment, harmonization with Australia, and modifications for New Zealand’s legal and market context. XRB proposes to issue the standard in August 2027, permit early adoption for reporting periods beginning on or after October 1, 2026, and require application from January 1, 2033. Existing New Zealand Climate Standards would remain available during the transition. Consultation closes September 30, 2026.
🔗 Read more → XRB (Consultation Page, Draft Roadmap, Consultation Document)

EBA Clarifies Governance Rules for ESG Retail Banking Products
The European Banking Authority (EBA) revised its product oversight and governance guidelines to make ESG and greenwashing requirements explicit for retail banking products such as mortgages, personal loans, deposits, payment accounts, payment services, and electronic money. Manufacturers must integrate greenwashing prevention into internal controls, assess whether ESG features suit the target market, and select capable distributors. Manufacturers and distributors must also ensure sustainability communications are fair, clear, and not misleading, with claims that are accurate, substantiated, and current. The revised guidelines apply from January 11, 2027.
🔗 Read more → EBA (Press Release, Final Report, Consolidated Guidelines)

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Study Finds Association Between Tax Avoidance and Greenwashing
A study of 391 Australian-listed companies found a positive association between corporate tax avoidance and greenwashing during 2019 to 2022, a period spanning the COVID-19 economic disruption. Researchers measured greenwashing as the gap between firms’ stated ESG commitments and subsequent performance reflected in Refinitiv controversy data. The relationship was strongest among “defender” firms, which emphasize efficiency, cost control, and established markets, and was more pronounced among non-environmentally sensitive companies and those hit hardest by the pandemic. The authors call for closer scrutiny of sustainability claims and corporate tax practices.
🔗 Read more → Murdoch University (Press Release), Wiley (Research Article)

Fashion Supply Chains Face Expanding Circularity Rules
Fashion companies are confronting increasingly complex sustainability requirements as European and U.S. state policies advance despite weaker federal action. The EU’s Ecodesign for Sustainable Products Regulation is expected to introduce digital product passports for textiles from 2028/2029, requiring detailed product-level information on materials, origins, recyclability, and repairability. In California, SB 707 requires textile producers to finance collection and recycling through a producer responsibility organization. A legal challenge to the organization selected to administer the program adds uncertainty, but registration and supply-chain preparation are already becoming immediate compliance priorities.
🔗 Read more → Forbes (Article)

Catch up on previous editions → ESGLitigation.com

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