The US Eighth Circuit Court of Appeals has ordered that the legal challenges against the Securities and Exchange Commission’s (SEC) climate disclosure regulation will be “held in abeyance” until the regulator either amends or renews its legal defence of the rule.
The rule was introduced under former chair Gary Gensler in 2024, and faced lawsuits from Republican-led states and business associations who argued it imposed excessive burdens and went beyond the SEC’s mandate. These lawsuits were consolidated in the Eighth Circuit.
Following the Gensler’s departure at the start of the year, the Republican-led SEC voted to end its legal defence of the climate disclosure regulation in March, informing the court that it has yielded the opportunity to present oral arguments in defence of the rule. In April the regulator stayed enforcement of the requirements until the completion of the judicial review.
The court stated that it is the “agency's responsibility to determine whether its Final Rules will be rescinded, repealed, modified, or defended in litigation”.
Noting that enforcement has been stayed, it argued that the “abeyance will not cause material prejudice to the petitioners”.