Issue - June 16, 2026

Good morning. It’s Tuesday, June 16, and this week’s ESG Litigation Weekly covers a federal court ruling vacating IRS guidance that narrowed a clean energy tax credit pathway for certain wind and solar projects, the ILO’s adoption of the first global convention on gig work standards, DUH’s reported default judgment against Bayer over net-zero marketing, and more.

Federal Court Vacates IRS Notice Restricting Clean Energy Tax Credits
A D.C. federal court vacated U.S. Internal Revenue Service (IRS) Notice 2025-42, which changed the “beginning of construction” standard for certain wind and solar projects seeking clean electricity production and investment tax credits. The court held the notice was arbitrary and capricious under the Administrative Procedure Act because the IRS did not adequately explain why it removed the long-standing five percent safe harbor for wind and most solar projects while leaving other clean energy technologies unaffected. The ruling remands the notice to the IRS and could restore a key tax credit pathway for affected wind and solar projects before the July 4 deadline.
🔗 Read more → San Francisco City Attorney (Press Release, Court Order, Court Opinion)

Federal Court Vacates EPA Environmental Justice Grant Termination Guidance
A South Carolina federal court ruled that the U.S. Environmental Protection Agency’s (EPA) decision and related guidance terminating the Environmental and Climate Justice Block Grant Program were unlawful and vacated the agency action. The program was established under the Inflation Reduction Act and funded through Clean Air Act Section 138, which appropriated $2.8 billion for grants through September 30, 2026. The court held that EPA’s closure of the program before that deadline was final, reviewable agency action and contrary to Congress’s mandate. The court denied broader relief, including a permanent injunction requiring EPA to implement the program.
🔗 Read more → Southern Environmental Law Center (Press Release, Court Order)

State AGs Challenge Federal Contractor DEI Contract Terms
Maryland Attorney General (AG) Anthony Brown co-led a coalition of 20 attorneys general in suing the Trump administration over new DEI-related terms for federal contracts. The complaint challenges agency implementation of Executive Order No. 14398, which directs federal agencies to add clauses barring contractors from “racially discriminatory DEI activities” and threatens penalties including contract termination, debarment and False Claims Act exposure. The states allege the Federal Acquisition Regulatory (FAR) Council and federal agencies bypassed required procurement procedures, failed to provide notice and comment, exceeded their authority and adopted vague terms that could chill lawful anti-discrimination efforts.
🔗 Read more → Maryland Attorney General (Press Release, Complaint Filing), Executive Order No. 14398

Taiwan Court Rejects Climate Challenge to Renewable Energy Rule
Taiwan’s Supreme Administrative Court rejected an appeal in Taiwan’s first climate lawsuit, ending a challenge to rules requiring large electricity users to support renewable energy. The case was brought by environmental groups including Greenpeace and the Environmental Jurists Association, which argued that obligations under Taiwan’s Renewable Energy Development Act were too weak to drive corporate emissions reductions. The court upheld dismissal of the case, with the lower court finding that citizens and groups may propose regulatory changes but do not have a legal right to compel the government to revise the rule.
🔗 Read more → Judicial Yuan’s News Release, Eco-Business

EDF Challenges EPA Amendments to Oil and Gas Methane Standards
Environmental Defense Fund (EDF) filed a petition for review in the D.C. Circuit challenging EPA’s April 2026 final rule amending methane and volatile organic compound standards for the oil and gas sector. The challenged action, effective June 8, 2026, revises parts of EPA’s 2024 methane rule, including temporary flaring provisions for associated gas and net heating value monitoring requirements for flares and enclosed combustion devices. EDF says the changes weaken protections against methane pollution by allowing additional flaring. The petition asks the court to review the final action under the Clean Air Act.
🔗 Read more → EDF (Press Release, Petition for Review)

ILO Adopts First Global Convention on Gig Work Standards
The International Labour Organization (ILO) adopted a Convention on decent work in the platform economy, creating a new international labor standard for digital labor platforms and platform workers. The Convention covers issues including fundamental labor rights, occupational safety and health, violence and harassment, correct worker classification, timely payment, social security access, dispute resolution and enforcement. It also addresses algorithmic management by requiring platforms to disclose the use and impact of automated systems, and to provide explanations and review for certain adverse automated decisions. The Convention will bind only ILO members that ratify it, after entry into force under its terms.
🔗 Read more → ILO ILC.114/Record No. 5A

SBTi Publishes Corporate Net-Zero Standard Version 2.0
The Science Based Targets initiative (SBTi) published Corporate Net-Zero Standard Version 2.0, updating its flagship framework for corporate climate target setting. The new standard moves beyond target validation toward implementation, with differentiated approaches for smaller companies and companies in lower-income countries, two or more near-term targets, and the option to set an overarching net-zero target. It introduces annual progress reporting, transition-plan expectations, and an implementation hierarchy prioritizing direct emissions reductions before broader system or sector-level actions. It also adds voluntary recognition for companies addressing ongoing emissions through high-integrity climate contributions. Companies will be able to submit targets under Version 2.0 from Q1 2027, with the standard becoming mandatory for all submissions from February 1, 2028.
🔗 Read more → SBTi (Press Release, Corporate Net-Zero Standard Version 2.0, Executive Summary, Getting Started Guide)

EU Council Agrees Position on Strengthening CBAM
The Council of the EU agreed its negotiating position on amendments to the Carbon Border Adjustment Mechanism (CBAM), which became fully operational on January 1, 2026. The position would extend CBAM to selected downstream products containing significant shares of covered goods, especially steel and aluminum-intensive products, with the expanded scope expected to apply from 2028 if adopted. It also supports anti-circumvention measures, including treatment of pre-consumer metal scrap and tools to address deceptive practices detected during reporting by high-risk companies. The Council narrows the proposed temporary exemption mechanism for serious and unforeseen circumstances before talks with Parliament.
🔗 Read more → Council of the EU (Press Release, Council General Approach, CBAM Explainer)

Louisiana Enacts Law Limiting Climate Liability Claims
Louisiana Governor Jeff Landry signed the Louisiana Energy Protection Act (HB 804), a law limiting certain climate-related civil liability claims in state courts. The measure bars covered actions seeking damages for personal injury, death, property damage or economic loss tied to greenhouse gas emissions and climate change, for cases filed on or after the law’s effective date. It preserves claims based on violations of enforceable state or federal emissions limits, permit terms or certain workplace safety standards. Supporters framed the law as protection against climate liability litigation, while opponents argued it restricts communities’ ability to seek compensation for climate-related harms.
🔗 Read more → The Center Square, Louisiana Legislature HB 804

ASIC Updates Financial Product Advertising Guidance
The Australian Securities and Investments Commission (ASIC) updated Regulatory Guide 234, its guidance on advertising financial products and services, including credit. The update aims to help promoters and publishers avoid false or misleading statements and misleading or deceptive conduct across media, including social platforms, internet advertising, video and AI-generated content. ASIC also added guidance reflecting enforcement and regulatory action since 2012. It consolidated past-performance advertising guidance from withdrawn Regulatory Guide 53, and retained specific guidance on greenwashing, disclaimers, fees and costs, comparisons, forecasts and target audiences. The guidance says ASIC may take greater interest in advertisements that do not meet it.
🔗 Read more → ASIC (Press Release, Regulatory Guide 234)

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DUH Says It Obtained Judgment Over Bayer Net-Zero Marketing
Deutsche Umwelthilfe (DUH) reported that it obtained a default judgment against Bayer AG from the Cologne Regional Court over climate-related marketing claims. The case challenged Bayer’s statement that it aimed to reach “net-zero emissions” by 2050. DUH argued that Bayer did not explain how the target would be implemented beyond measures described for the period to 2030, and did not provide information on how remaining emissions would be offset from 2050 onward. DUH said Bayer changed the advertising after proceedings began but did not commit to refrain from using the claim in the future.
🔗 Read more → DUH’s Press Release

Climate Litigation Creates New Risk Questions for Insurers
A new LSE Grantham explainer examines how rising climate litigation could affect insurers beyond physical climate losses from storms, floods and other hazards. It highlights potential coverage disputes involving policy wording, pollution exclusions and whether climate-related harm qualifies as an insured occurrence. It also discusses subrogation, where insurers seek to recover payouts from third parties allegedly responsible for damage, and notes that attribution science could shape future claims.
🔗 Read more → LSE Grantham Research Institute

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