California’s first emissions deadline survives. Wider climate disclosures are on hold.

One day before California’s first mandatory corporate emissions reports are due, the Ninth Circuit left the November 10 deadline in place for direct emissions and emissions from purchased energy. The same opinion reversed the lower court on value-chain reporting and kept climate-risk disclosures on hold—the parts of California’s system intended to expose emissions and financial exposure beyond companies’ own operations.

The November 9 published opinion affirmed the district court’s refusal to preliminarily enjoin SB 253’s Scope 1 and Scope 2 requirements. It reversed as to SB 253’s Scope 3 requirement and SB 261, and sent the case back for the district court to decide whether Scope 3 can be severed. This is a preliminary-injunction ruling, not a final judgment on the laws’ constitutionality.

What remains is concrete. CARB says U.S.-organized business entities with more than $1 billion in annual revenue that do business in California must report prior-year Scope 1 emissions from operations they own or control and Scope 2 emissions from purchased energy by November 10, 2026.

What is blocked or delayed reaches further. Scope 3, scheduled to begin in 2027, covers emissions from suppliers, customers, distributors and other value-chain actors. SB 261 applies to covered U.S. companies doing business in California with more than $500 million in annual revenue and requires biennial climate-related financial-risk reports. Those disclosures were designed to show risks and emissions that sit outside a company’s factory gates but can still shape costs, supply chains and investment exposure.

The majority treated Scope 1 and 2 reporting as commercial speech and upheld it under intermediate scrutiny. It treated Scope 3 as noncommercial speech about third parties, triggering strict scrutiny, and said California had not shown mandatory reporting was narrowly tailored. The court applied strict scrutiny to SB 261 as well, describing the required assessments as value-laden judgments on a politically fraught subject and saying the state had less restrictive options.

Environmental Defense Fund, which supported the state as an amicus, said the decision preserves public access to direct and energy-use emissions but delays the fuller benefits of value-chain and risk disclosures. California’s attorney general told Reuters the state was evaluating next steps, welcomed the portion left enforceable and remained committed to access to climate data.

The business groups’ strongest counterargument is cost and compelled speech. The Chamber called the decision an important victory against the most onerous requirements. The Farm Bureau said large companies would otherwise press small and mid-sized farms for emissions data. The majority also said the record did not show mandatory Scope 3 reporting was necessary to reduce emissions and found its connection to investor decision-making too attenuated.

The ruling is therefore neither a wholesale defeat nor a clean survival for California’s disclosure system. Tomorrow’s deadline will produce information about what covered companies emit directly and through purchased energy. For now, the public will get less visibility into the supply-chain emissions and financial risks that extend beyond those companies’ operational boundaries. On remand, the district court must determine whether the Scope 3 provision can be severed and frame preliminary relief accordingly. Further appellate review remains possible.