Issue - October 20, 2026

Good morning. It’s Tuesday, October 20, and this week’s ESG Litigation Weekly covers a lawsuit seeking to require Montana utility regulators to account for climate-related costs and risks, ESMA’s enforcement priorities for 2026 sustainability statements, a class action over AGL’s “carbon neutral” energy add-ons, and more.

3M Outlines Defense in Australia’s A$2 Billion PFAS Lawsuit
3M outlined its planned defense to the Australian government’s Federal Court lawsuit seeking about A$2 billion over alleged PFAS contamination at 28 Australian Defence Force bases and surrounding areas. The Commonwealth alleges that 3M continued selling PFAS-containing firefighting foam despite information about health and environmental risks and made misleading safety assurances. According to ABC News, at an October 16 case management hearing, 3M indicated that it would challenge the public nuisance claim and dispute aspects of alleged toxicity and liability, including responsibility for remediation costs. Its defense is due December 11. The allegations have not been adjudicated.
🔗 Read more → ABC News, Federal Court of Australia (Court Files)

Montana Groups Sue Utility Regulator Over Climate-Related Duties
Seventeen organizations sued the Montana Public Service Commission and Department of Public Service Regulation in state district court in Missoula County. They seek to require the Commission to account for climate-related costs and risks in utility decisions, following its rejection of requests for declaratory rulings made in a 2024 petition. The groups rely in part on Held v. State of Montana, in which the Montana Supreme Court affirmed that the state constitutional right to a clean and healthful environment includes a stable climate system. They seek a declaration requiring the Commission to account for and take reasonable steps to avoid climate-related costs, and ask the court to vacate denial decisions they argue were arbitrary, capricious, and unlawful.
🔗 Read more → Earthjustice (Press Release, Court Filing)

Supreme Court Declines Review of Forced-Labor Case Against Rubicon Resources
On October 13, the U.S. Supreme Court declined to review a Ninth Circuit ruling reopening claims against Rubicon Resources in a lawsuit brought by seven Cambodian workers. The workers allege they were trafficked to Thailand and subjected to forced labor producing seafood for the U.S. market. The appeal concerned civil liability for attempting to benefit from a trafficking venture under the Trafficking Victims Protection Reauthorization Act. The Ninth Circuit held that a January 2023 amendment expressly covering attempted benefit applied retroactively and warranted relief from the earlier judgment for Rubicon. The Supreme Court’s denial leaves that ruling in place without deciding the underlying allegations or Rubicon’s liability.
🔗 Read more → SeafoodSource, U.S. Supreme Court (Case Docket, Ninth Circuit Opinion)

Wisconsin Youth Seek Supreme Court Review of Climate Rights Case
Fifteen youth plaintiffs filed an October 12 petition asking the Wisconsin Supreme Court to hear Dunn v. Wisconsin Public Service Commission directly, bypassing the Court of Appeals. They challenge laws they allege prevent the Commission from considering greenhouse gas emissions when approving new fossil fuel power plants and from requiring renewable energy procurement beyond statutory requirements. The Dane County Circuit Court dismissed the case on April 23, finding that it presented political questions for the other branches of government, without deciding whether viable constitutional claims had been pleaded. The plaintiffs seek reversal and further proceedings on claims concerning constitutional rights to life and liberty and public trust protections.
🔗 Read more → Midwest Environmental Advocates (Press Release, Court Filing)

California’s Initial SB 253 and SB 261 Implementing Regulation Takes Effect
The California Air Resources Board’s (CARB) initial regulation implementing SB 253 and SB 261 took effect on October 12 following approval by the Office of Administrative Law. It defines covered entities, establishes annual implementation fees, and sets first-year emissions reporting requirements. Subject to exclusions, the laws cover entities formed under U.S. law that do business in California and exceed annual revenue thresholds of $1 billion and $500 million, respectively. Revenue is measured using the lower of the two preceding fiscal years. SB 253 Scope 1 and Scope 2 reporting is due November 10, 2026. First-year alternatives include reporting based on information already held or being collected by December 5, 2024. Entities that neither held nor were collecting that information by that date may instead submit a statement of non-reporting. Scope 3 reporting is not required in 2026. Enforcement of SB 261 remains enjoined by the Ninth Circuit pending the appeal, and CARB says it will not enforce the reporting requirement while the injunction remains in effect.
🔗 Read more → CARB (Approval Notice, Final Regulatory Order, Rulemaking Page, SB 261 Docket)

ESMA Sets Enforcement Priorities for 2026 Sustainability Statements
The European Securities and Markets Authority (ESMA) published enforcement priorities for the 2026 annual financial reports of issuers on European Economic Area regulated markets. For sustainability statements, enforcers will focus on double materiality assessments and connections between material impacts, risks, and opportunities, and the policies, actions, targets, and metrics addressing them. ESMA calls for comparable rigor in assessing positive and negative impacts, and company-specific explanations covering operations and value chains. Reviews of connected information will focus particularly on climate change and own-workforce disclosures under ESRS E1 and S1.
🔗 Read more → ESMA (Press Release, 2026 Enforcement Priorities)

Council Publishes EU Institutions’ Opening Positions on SFDR Reform
The Council of the EU published a comparison of the European Commission’s, Parliament’s, and Council’s opening positions ahead of negotiations on reforming the Sustainable Finance Disclosure Regulation (SFDR). The proposals would introduce formal sustainable, transition, and ESG basics product categories. All three positions support a minimum 70% allocation aligned with the relevant category’s sustainability claim. They also propose removing the existing definition of “sustainable investment” and incorporating underlying concepts into category criteria. The proposals remain subject to negotiation and have not become law.
🔗 Read more → Council of the EU (Document 14335/26)

TNFD, SBTN and Nature Positive Initiative Release Coordinated Nature Guidance
The Taskforce on Nature-related Financial Disclosures (TNFD), Science Based Targets Network (SBTN), and Nature Positive Initiative released coordinated updates intended to align corporate nature assessment, target-setting, measurement, and disclosure. TNFD’s LEAP 2.0 assessment approach, covering Locate, Evaluate, Assess and Prepare, expands guidance on measuring the state of nature, assessing risks and opportunities, transition planning, financial institutions’ portfolios, and interoperability with SBTN methods. The releases also include Science-Based Targets for Nature 2.0 and Nature Positive Initiative indicators, and metrics providing a common measurement foundation. TNFD describes LEAP as guidance supporting due diligence for disclosures and broader assessment of nature-related issues.
🔗 Read more → TNFD (Press Release, LEAP 2.0 Guidance)

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AGL Faces Class Action Over “Carbon Neutral” Energy Add-Ons
AGL Energy has been served with a Federal Court class action alleging that its “carbon neutral” electricity and gas add-ons breached Australian consumer law. The proceeding, brought through Slater and Gordon, alleges that customers paid extra for emissions offsets but that the overwhelming majority of offsets used did not prevent, reduce, or remove emissions equivalent to customers’ energy use. It alleges misleading or deceptive conduct and breaches of consumer guarantees, including fitness for purpose, and seeks compensation and injunctive relief. AGL says it takes its compliance obligations seriously and intends to vigorously defend the proceedings. The allegations have not been adjudicated.
🔗 Read more → AGL (Notice of Class Action), Slater and Gordon (Press Release, Case Page)

Hannaford Sued Over ‘Sustainable’ Farmed Salmon Marketing
A consumer filed a putative class action against Hannaford Bros. Co., LLC and Ahold Delhaize USA Services, LLC alleging that the grocery chain misled New York shoppers by marketing farmed salmon as “sustainable” and “sustainably harvested.” The complaint alleges that Hannaford’s salmon is sourced from industrial net-pen operations whose practices can cause nutrient pollution, chemical and pesticide releases, fish escapes, disease, and mass mortality events, which the plaintiff argues are inconsistent with the retailer’s sustainability claims. The lawsuit asserts claims under New York General Business Law Sections 349 and 350 and seeks damages and other relief on behalf of purchasers of the products.
🔗 Read more → Center for Food Safety (Press Release, Court Filing)

ESMA Publishes Guidance on Impact and Climate Transition Claims
ESMA published two thematic notes illustrating good and poor practices for impact and climate transition claims. For impact claims, it asks market participants to distinguish investor contributions from investee outcomes and explain whether and how they address intentionality, additionality, and measurability. It cautions against treating exclusions or ESG risk metrics as substitutes for impact criteria. For climate transition claims, ESMA emphasizes clear ambitions, implementation strategies, assumptions, dependencies, and regular progress reporting. The notes address marketing and other non-regulatory communications. They create no new regulatory requirements or prescribed level of ambition and explain existing expectations that claims be clear, fair, and not misleading.
🔗 Read more → ESMA (Press Release, Impact Claims Note, Transition Claims Note)

Catch up on previous editions → ESGLitigation.com

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