Texas Court issues preliminary ruling in climate shareholder proposal case
On 22 May, the Court of Texas delivered a preliminary ruling in the case brought by ExxonMobil against NGOs Arjuna Capital and Follow This. ExxonMobil argues that it may exclude the NGO’s’ shareholder proposal on Exxonmobil’s climate policy from its proxy statement. The NGOs have already withdrawn the proposal. In its ruling, the court assumed subject-matter jurisdiction over the case and personal jurisdiction over US-based defendant Arjuna Capital. It did not accept personal jurisdiction over Dutch defendant Follow This. The ruling comes after several institutional investors threatened to vote against the installation of ExxonMobil’s new CEO, saying the case was an anti-climate action and an anti-shareholder move. The case will now move on to the merits with Arjuna Capital as the sole defendant.

ITLOS issues advisory opinion on climate change and the sea
On 21 May, the International Tribunal for the Law of the Sea (ITLOS) issued an advisory opinion on climate change and international law of the sea. The opinion was requested by a commission of small island states, and is based on a large number of amicus briefs and two weeks of hearings. The opinion states that the 1982 UN Convention on the Law of the Sea (UNCLOS) imposes a strict due diligence obligation on contracting states with regard to transboundary pollution caused by greenhouse gas emissions. In particular, states are required to take all necessary measures to prevent, control and reduce GHG emissions that directly or indirectly affect oceans and seas. They should adopt and enforce laws and regulations based on the best available science and climate change treaties such as the Paris Agreement, and cooperate and harmonise their policies in this regard. In particular, states should also protect, preserve and restore marine resources in relation to the impacts of anthropogenic GHG emissions. The advisory opinion is expected to influence the pending change-related advisory opinions at the Inter-American Court of Human Rights and the International Court of Justice.

Dutch authorities launch criminal investigation into wood importers
On 17 May, the Netherlands Food and Consumer Product Safety Authority (NVWA) announced that it is conducting a criminal investigation into two Dutch importers of wood. According to the authorities, the importers were not able to prove that they conducted sufficient due diligence on the origin of wood which they imported from Brazil and Suriname. This could constitute a breach of the Timber Regulation, to be replaced by the Deforestation Regulation as of 30 December 2024. The investigation is still pending.

German court orders federal government to adopt measures to achieve 2030 climate target
On 16 May, the higher administrative court of Berlin-Brandenburg ruled that the German federal government’s climate protection plan is not sufficient to achieve the climate target of 65% reduction in 2030 compared to 1990, as set out in the Climate Protection Act (CPA). The court finds that it is foreseeable that most of the sectoral annual targets of the CPA will be exceeded, and that the plan suffers from methodological flaws and is partly based on unrealistic assumptions. The federal government is ordered to take measures to align the climate protection plan with the targets of the CPA. The ruling is subject to appeal. It follows an earlier administrative judgment of November 2023, which ordered the federal government to adopt an immediate action programme for the buildings and transport sectors.

UK High Court rules that UK climate protection plan is unlawful

On 3 May, the administrative UK High Court ruled that the UK government’s climate protection plan is in breach of the Climate Change Act (CCA). The court ruled that the plan was an ‘irrational decision’ by the secretary of state because he was not sufficiently informed about the risk that the proposed policies would be insufficient to meet the carbon budgets set out in the CCA. The secretary of state also failed to demonstrate that the climate protection plan sufficiently contributes to sustainable development. The parties will now make submissions on the court’s order to revise the plan. The ruling follows a judgment in July 2022, which ordered the UK government to adopt a revised climate protection plan.

Dutch energy provider withdraws climate claim
On 2 May, the Dutch Authority for Consumers and Markets (ACM) announced that the Dutch energy company Eneco will remove the claim ‘faster towards climate neutral’ (in Dutch: ‘sneller klimaatneutraal’) from its advertising. The announcement follows ‘normative discussions’ with the company. The ACM assessed the claim as potentially misleading, because it does not make clear that it concerns an ambition for the year 2035. In its announcement, the ACM states that it must be clear to consumers what companies will actually do in terms of sustainability, referring to its guidelines on sustainability claims.

  • May 2024

    EU authorities launch greenwashing investigation in the aviation industry
    On 30 April, the EC and the EU Consumer Protection Cooperation (CPC) Network announced a coordinated anti-greenwashing enforcement action against 20 European airlines. The EC and CPC Network are concerned that certain green claims made by these airlines qualify as misleading under the Unfair Commercial Practices Directive (UCPD). The EC and the CPC Network will now enter into discussions with the airlines, on the basis of which the CPC authorities will decide on any further enforcement action. The enforcement action follows a complaint by EU consumer organisation BEUC, and a Dutch court ruling on similar legal grounds against a Dutch airline.

    Anti-SLAPP directive published in Official Journal
    On 16 April, the directive on protection from strategic lawsuits against public participation (SLAPP) was published in the Official Journal. The directive aims to protect natural and legal persons who engage in public participation, such as journalists, human rights defenders and NGO’s, from manifestly unfounded claims and abusive court proceedings in civil or commercial matters with cross-border implications. It introduces procedural minimum safeguards, rules on early dismissal, remedies against abusive court proceedings and procedural rules protecting from third-country SLAPP-proceedings. Member States have to transpose the directive into national law by 7 May 2026.

    ECtHR rules on three climate cases
    On 9 April, the European Court of Human Rights (ECtHR) ruled on three climate change cases. The cases of Carême v. France and Duarte Agostinho et al v. Portugal and 32 other States were declared inadmissible on formal grounds. In Verein Klimaseniorinnen v. Switzerland, the Court ruled that Switzerland’s climate laws violated Article 8 of the European Convention on Human Rights (ECHR) and found a violation of Article 6 ECHR. Notably, the Court ruled that states have a limited margin of appreciation when setting climate targets, but a wide margin of appreciation when choosing the measures to achieve those targets. The Court also provided criteria for determining whether states have acted within their margin of appreciation in relation to climate policies. See last month’s Highlight for more information.

    Australian court declares investment manager’s green statements misleading
    On 28 March, the Federal Court of Australia ruled that several sustainability-related statements made by Australian investment manager Vanguard are misleading. Vanguard had stated in various ways that it excluded bond issuers with significant activities in certain industries. At the same time, it did not apply these exclusion criteria to a significant proportion of the securities included in the index in which it invested. The Court will consider the penalty at a hearing on 1 August.

    Supreme Court of India establishes constitutional right relating to climate change
    On 21 March, the Supreme Court of India established a right ‘to be free from the adverse effects of climate change’ under the Indian Constitution. The Court had previously recognised a constitutional right to a clean environment in earlier decisions. In the light of the increasing impacts of climate change, the Court now established a ‘right to be free from the adverse effects of climate change’ as a distinct constitutional right. This new climate-related human right is grounded on (i) the right to life and personal liberty and (ii) the right to equality under the Indian Constitution. In the case at hand, the Court emphasised that this right must be balanced with other constitutional interests relating to India’s economic development, social equity, physical environment and biodiversity. An expert committee was appointed to advise the Court on how to balance these constitutional interests in this particular case.

  • April 2024

    Travel website removes sustainable travel campaign
    On 25 March, the Dutch Authority for Consumers and Markets (ACM) announced that travel website Booking.com will remove its ‘Travel Sustainable’ campaign. The announcement follows ‘normative discussions’ of the ACM with the company. As part of the campaign, member accommodations received a sustainability score and a number of green leaves on the website. The ACM assessed the presentation of this programme as misleading, among others because (i) the statement ‘Travel Sustainable’ could wrongly make consumers believe that travelling to the selected accommodations is sustainable; (ii) it was unclear to consumers what the sustainability score was specifically based on; and (iii) the programme did not display the sustainability efforts of non-member accommodations.

    Amsterdam District Court declares 15 green statements by Dutch airline misleading
    On 20 March, the District Court of Amsterdam ruled that 15 sustainability-related statements by Dutch airline KLM are misleading. The case marks the first time a Dutch court decides on a greenwashing claim. Of considerable practical relevance are the court’s considerations on the statements on (i) commitment to the Paris Agreement targets; (ii) measures taken to achieve net zero ambitions; (iii) the use of carbon credits; and (iv) the use of sustainable aviation fuel. The court ruled that statements violated the Dutch implementation of the Unfair Commercial Practices Directive. The court found that it is sufficiently plausible that the average consumer would take a different economic decision as a consequence of the statements. The court rejected the NGO’s other claims, which included an injunction to stop making these statements in the future, an order to publish rectification statements, and an order to publish warnings on its website and on flight tickets.

    Spanish energy company files greenwashing lawsuit against competitor
    On 18 March, it was reported that Spanish energy company Iberdrola has filed a greenwashing lawsuit against its competitor Repsol based on Spanish competition law. Iberdrola accuses Repsol of presenting itself as a leader in the energy transition while being the largest greenhouse gas emitter in Spain. Iberdrola requests the removal of Repsol’s advertising campaigns relating to biofuels and green hydrogen.

    Belgian farmer files climate lawsuit against French energy company
    On 13 March, a Belgian farmer and three NGO’s sued French energy company TotalEnergies at the Commercial Court of Doornik. The farmer claims that TotalEnergies is partly responsible for the damage caused to his operations by extreme weather events in the period 2016-2022, and requests a symbolic amount of EUR 1,00 in damages. TotalEnergies is also requested to (i) immediately stop investing in new fossil fuel projects; (ii) reduce its greenhouse gas emissions from the production and supply of fossil fuels by 60% in 2030; and (iii) reduce its oil and gas production by 47% in 2030, 75% in 2040 and 88% in 2050. The claim is based on Belgian tort law and refers to the recent ruling of the Brussels Court of Appeal in the climate case (Klimaatzaak) against the Belgian governments.

    OECD complaint against Luxembourg pension fund
    On 11 March, NGO Greenpeace Luxembourg filed a complaint with the OECD National Contact Point (NCP) against sovereign pension fund Fonds de Compensation de la Sécurité sociale SICAV FIS (FDC SICAV). The NGO alleges that the fund’s investment strategies are not in line with the OECD Guidelines for Multinational Enterprises. It requests the fund to (i) set up an investment strategy including risk-based human rights and environmental due diligence and in line with the Paris Agreement; (ii) conduct human rights and environmental due diligence on its investments; and (iii) establish a grievance mechanism in line with the UNGPs. If the parties do not reach a solution during the mediation phase, the NCP will issue a non-binding advice on the matter.

    Danish court declares pork producer’s green statement misleading
    On 1 March, Denmark’s Western High Court ruled that pork producer Danish Crown has misled consumers by marketing its products as ‘climate-controlled’. The case was brought by NGO’s the Danish Vegetarian Association and the Climate Movement. The court ruled that Danish Crown could not sufficiently substantiate its statement that its meat is ‘climate-controlled pig’. Notably, the court ruled that this statement could be expected to significantly distort the economic behaviour of the average consumer. The statement ‘Danish pork is more climate-friendly than you think’ was not found misleading. The court also rejected the NGO’s request for a prohibition to make these statements in the future and to publish a rectification.

  • March 2024

    German webshop to remove green claims and filters from website
    On 22 February, the Commission and several national supervisory authorities, including the Dutch Authority for Consumers and Markets (ACM), announced that German webshop Zalando will remove misleading sustainability claims from its website. The announcement follows a coordinated action of European supervisors (Consumer Protection Cooperation Network) on sustainability claims in the European garment sector. Zalando has agreed to cease the generic use of the word ‘sustainability’ and other incorrect claims to indicate sustainability benefits, including green visuals in its product search filters. Zalando will also provide clear information on specific product advantages, such as the indication of a certain percentage of recycled materials, and will revise its general sustainability pages.

    New Zealand Supreme Court corporate climate case proceeds to trial
    On 7 February, the New Zealand Supreme Court ruled that the climate case of Māori leader Mike Smith against seven New Zealand fossil fuel companies will proceed to trial. Smith does not request damages, but rather an order on the companies to reduce their greenhouse gas emissions. The claim, based on New Zealand common law, has three grounds: public nuisance, negligence and a proposed climate duty. The Court held that the claim based on public nuisance amounts to a ‘reasonably arguable cause of action’, addressing four topics: (i) plausible identification of actionable public rights; (ii) whether otherwise legal activities can still amount to public nuisance; (iii) the special damages rule; and (iv) causation. The Court also did not strike out the other two claims. While the Court explicitly noted that its preliminary decision “says little about [the] merits” of the case, it will have an impact on other corporate climate cases under common law.

    Polish energy company’s management sues former directors for investing in coal plant project
    On 30 January, a large majority of the shareholders of Polish energy company Enea voted in favour of a motion to claim damages from the company's former directors and supervisory board members, including their D&O liability insurers, for investing in a coal-fired power plant project. The directors allegedly ignored warnings about the project's financial climate risks and failed to conduct sufficient due diligence on the financial feasibility of the project in light of, inter alia, rising carbon prices and changing energy demand. The project was abandoned in 2020, after NGO ClientEarth successfully challenged the project in court, resulting in a financial loss of more than EUR 170 million.

  • February 2024

    Friends of the Earth Netherlands (Milieudefensie) announces climate case against ING
    On 19 January, NGO Friends of the Earth Netherlands (Milieudefensie) announced its intention to initiate a climate case against Dutch bank ING. Milieudefensie demands that ING (i) aligns its climate policy with the 1.5°C target of the Partis Agreement; (ii) reduces its absolute CO2 emissions by 48% and its CO2-eq emissions by 43% in 2030 compared to 2019; and (iii) among others, demands a climate plan from its large corporate clients and phases out its financing of the fossil fuel sector. If ING does not concede to these demands within eight weeks, Milieudefensie intends to initiate its climate case. ING published its reaction here.

    Norwegian court invalidates impact assessments for three Norwegian oil fields
    On 18 January, the Oslo District Court ruled that the impact assessments for three Norwegian oil fields, carried out by the Norwegian Ministry of Energy, are invalid. The court suspended the granting of any new permits required for the further development or operation of the oil fields until a final ruling on the validity of the approval decisions is delivered. The impact assessments were ruled invalid because they did not, or did not sufficiently, address the expected greenhouse gas emissions associated with the oil fields. At this stage, the Court did not establish a violation of Articles 2, 8 or 14 ECHR, as the climate cases at the ECHR are still pending.

    Paris Court of Appeal installs chamber for ESG cases
    On 15 January, the Paris Court of Appeal announced the installation of a dedicated chamber within its economic division to deal with cross-disciplinary environmental disputes. In particular, the chamber will handle appeal proceedings relating to the French due diligence law, the CSRD and the CSDDD. The Court states that the installation of this chamber demonstrates the importance it attaches to these cases. The chamber will hear its first cases in the first half of 2024.

    Bonaire climate case against the Dutch State
    On 11 January, NGO Greenpeace Netherlands and eight residents of the island of Bonaire initiated a collective climate case against the Dutch State. In their writ of summons, the claimants request the District Court of the Hague to, inter alia, order the Dutch State to implement climate mitigation measures, as well as various adaptation measures to protect the inhabitants of Bonaire from the consequences of climate change. The primary mitigation claim requests an order on the Dutch State to reduce its CO2-eq emissions to net zero by 2030, with any remaining emissions to be compensated by international climate finance.

  • January 2024

    ACM addresses sustainability claims of Dutch supermarket chain
    On 21 December, the Netherlands Authority for Consumers and Markets (ACM) announced that Dutch supermarket chain Plus will remove unsubstantiated sustainability claims from its stores and brochures, following a ‘normative discussion’ with the supermarket chain. The supermarket’s green claims, such as ‘climate neutral supermarket’, ‘conscious’ and ‘sustainable’, were based on external research on consumer perceptions of the supermarket, but lacked factual substantiation. The supermarket chain has agreed to remove the green claims and will apply the ACM’s updated Guidelines on sustainability claims. The enforcement action follows large-scale greenwashing enforcement actions by the ACM in H2 2022.

    State of Tennessee subpoenas BlackRock in anti-ESG lawsuit
    On 18 December, the Attorney General of the US State of Tennessee subpoenaed BlackRock Inc. in an ESG-related consumer protection lawsuit. This follows a subpoena issued on 15 December by the Judiciary Committee on the US Congress regarding possible antitrust law violation by Blackrock’s agreements to decarbonise its assets. The state alleges that BlackRock made misleading statements about the influence of ESG considerations on its investment strategies. The complaint states that BlackRock has made firm-wide ESG-related commitments, while at the same time marketing several funds as exclusively pursuing financial goals. The State argues that these two positions are fundamentally conflicting. BlackRock’s statements that ESG is a driver of companies’ financial performance would not be supported by facts and contradict other statements made by BlackRock. The State requests, among others, a civil fine of USD 1.000 for each violation of the Tennessee Consumer Code and restoration of damages.

    Australian superannuation fund to pay USD 11.3 million greenwashing fine
    On 7 December, the Australian Securities and Investments Commission (ASIC) requested the Australian Federal Court to approve a settlement agreement with Australian superannuation fund Mercer. Under the terms of the agreement, the fund will pay USD 11.3 million to settle the greenwashing case brought by ASIC earlier this year. The case concerned the fund’s statements that it excluded investments in the fossil fuel, gambling and alcohol sectors, when in fact it had extensive holdings in these sectors. The Federal Court is expected to approve the settlement agreement. Two other greenwashing cases brought by ASIC are still pending at the Australian Federal Court.

    French company La Poste ordered to improve its due diligence on social circumstances of subcontractors
    On 5 December, the Paris Judicial Tribunal in first instance ruled that the 2019 and 2020 due diligence plans of post company La Poste violated the French loi de vigilance or due diligence law. The SUD PTT trade union brought the case after it was discovered that undocumented workers were illegally working night shifts at a French subcontractor of a La Poste subsidiary. The tribunal ruled that La Poste’s risk mapping as prescribed by the loi de vigilance did not adequately reflect the risks associated with, among other things, illegal labour, resulting in a lack of the necessary evaluation procedures for subcontractors. The tribunal therefore ordered La Poste to improve its due diligence plan by adding a risk map, to establish subcontractor assessment procedures that are based on the specific outcomes of its risk mapping, and to improve its whistleblowing mechanism and internal controls. The union’s ancillary claims were rejected. Several other loi de vigilance­-based cases against French corporates are pending.

    Friends of the Earth files OECD complaint against US credit agency for fossil fuel project investments
    On 5 December, Friends of the Earth filed a complaint with the OECD National Contact Point (NCP) against the Export-Import Bank of the United States (US EXIM). The NGO highlights EXIM’s role in projects that would not otherwise be financed and argues that EXIM fails to act in line with governmental commitments, the Paris Agreement and the Clean Energy Transition Partnership as it invested almost USD 1 billion in the fossil fuel sector in 2023. The NGO calls on EXIM to bring its policies in line with the OECD Guidelines, by fully and publicly reporting on its total greenhouse gas emissions, including financed emissions, and by setting clear and rapid goals to align its portfolio with the 1.5°C goal of the Paris Agreement. If the dialogue between the parties fails, the NCP is expected to issue a statement on the case in approximately one year, which may include recommendations to EXIM.

  • December 2023

    Brussels Court of Appeal imposes 55% reduction obligation on Belgian governments for 2030
    On 30 November, the Brussels Court of Appeal ruled that the climate policies of the Federal State, the Flemish Region and the Brussels Region violate articles 2 and 8 of the European Convention on Human Rights and their duty of care under Belgian tort law by failing to do their part in the reduction of global greenhouse gas emissions. Diverting from the ruling in first instance, the Court of Appeal imposed a specific order on the governments as a relief for the unconstitutionality of the policies. The court ordered the governments to reduce, in consultation with the region Wallonia, the yearly greenhouse gas emissions at the Belgian territory by at least 55% by 2030 as compared to 1990. The claim against the Walloon Region was dismissed because it had already legally implemented the aforementioned target. Since the Urgenda case, this is the second time worldwide that a court has ordered a government to reduce its greenhouse gas emissions by a specific percentage by a certain date.

    German government ordered to adopt climate action programmes on buildings and transport sectors
    On 30 November, the German higher administrative court of Berlin-Brandenburg ordered the German federal government to adopt a resolution on an ‘immediate action programme’ for emission reduction in the buildings and transport sectors for the years 2024-2030. The court ruled that Section 8 of the German Climate Protection Act (CPA) required the adoption of such a resolution, as the Federal Environment Agency had determined that the permissible sectoral emission levels as specified in the CPA were exceeded in 2021 and 2022. The government’s Climate Protection Programme 2023 does not meet the requirements of the CPA for an immediate action programme, as it does not contain effective short-term measures that ensure compliance with the CPA’s sectoral maximum emission levels. The court allowed an appeal to the Federal Administrative Court.

    Dutch NGO Milieudefensie to launch climate case against financial institution
    On 27 November, Dutch NGO Milieudefensie (Friends of the Earth Netherlands) publicly announced that it will launch its next climate case against a Dutch financial institution. The announcement was accompanied by a study of research group SEO Amsterdam Economics, which assesses the integrity and transparency of the climate plans of seven Dutch financial institutions. The study is a targeted follow-up to Milieudefensie’s broader 2022 study on the climate plans of 29 large Dutch companies. On 19 January 2024, Milieudefensie will publicly announce which financial institution will be targeted.

    UK Court of Appeal definitively dismisses claim against Shell board members
    On 16 November, the UK Court of Appeal definitively dismissed ClientEarth’s derivative claim against the board members of Shell plc, by rejecting CientEarth’s application for appeal against the UK High Court’s decision on this matter in May of this year. In this case, ClientEarth argued that the board members of Shell breached their fiduciary duties under UK company law relating to the management of climate risk, most notably by failing to adopt a Paris-aligned transition strategy and violating the Dutch court order in Milieudefensie v. Shell. As the UK Court of Appeal is the highest competent judge on this matter, the case is now definitively closed.

    PepsiCo sued for plastic pollution
    On 15 November, the New York State Attorney General filed a civil claim against PepsiCo for polluting the environment and endangering public health with its single-use plastic bottles, caps and wrappers. The State accuses PepsiCo of contributing to a public nuisance by generating a significant share of plastic waste found in and near the Buffalo River. More than 17% of the identifiable plastic items in the river was produced by PepsiCo. In addition, the State argues that the company failed to warn consumers about the potential health and environmental risks of plastics, and misled the public about its progress in fighting plastic pollution. This is the first ESG lawsuit filed by a U.S. state against a major plastic producer.

    Request for disclosure of Australian bank’s biodiversity risk framework
    On 9 November, a shareholder of Australian bank ANZ filed a discovery request against ANZ at the Federal Court of Australia, requesting disclosure of the bank’s internal risk management framework relating to the ‘twin risks’ of climate change and biodiversity loss. The shareholder seeks to assess whether the bank is adequately managing the material risks associated with climate change and biodiversity loss, in view of Australian prudential and misleading conduct laws. The shareholder states that she initiated this claim because ANZ’s annual report does not sufficiently address the management of these risks. This is the first discovery request that specifically addresses the interrelationship between biodiversity risks and climate change risks.

    Criminal complaints against French banks relating to illegal deforestation
    On 8 November, French NGOs filed a criminal complaint with the French Financial Prosecutor’s Office, alleging that four French banks and insurance companies violated anti-money-laundering laws by providing deforestation-linked finance to Brazilian companies. This is the first criminal complaint against French banks for money laundering and receiving stolen goods, based on their alleged financial support of and profit from activities responsible for deforestation. The complaint follows a pending civil lawsuit on the same matter.

    Consumer groups launch greenwashing complaint on plastic bottles
    On 7 November, the European Consumers Organisation (BEUC), including the Dutch Consumentenbond and 12 other member organisations, filed a greenwashing complaint with the EC. BEUC is requesting a coordinated supervisory investigation by the EC and the network of supervisory authorities (CPC) into the ‘100% recycled/recyclable’ claims and green visuals on plastic bottles of Coca-Cola, Nestlé and Danone. BEUC’s complaint alleges that these claims and visuals are in breach of European consumer law because they would not reflect the practical and technical realities of plastic recycling. BEUC’s complaint follows a similar legal complaint against the European aviation sector (see July edition of ESG Matters).

  • November 2023

    London High Court dismisses legal challenges to new North Sea oil and gas exploration
    On 19 October 2023, London’s High Court dismissed legal challenges by NGOs Greenpeace and Uplift to the UK’s 2022 licensing round for new oil and gas exploration in the North Sea. The claimants argued that the Secretary of State had acted unlawfully or ‘irrationally’ by not considering the scope 3 emissions (arising from consumer end-use of oil- and gas-derived fuels) that can be attributed to the licensing round. After the claimants were granted permission for judicial review in April 2023, the Court has now dismissed their argument on the merits. Greenpeace said it will appeal the Court’s decision.

  • October 2023

    State of California sues carbon majors for alleged climate damage and misinformation
    On 15 September, the State of California added another case to the growing list of state climate lawsuits against carbon majors. The state filed a lawsuit against several carbon majors, their subsidiaries, and an industry group, alleging that the defendants have caused public nuisance and have knowingly misled the public and policymakers. Among other things, the state is asking the court to order the defendants to compensate the damages that have been or will be caused by climate change.

    ECB’s Frank Elderson urges banks and supervisors to get up to speed with climate litigation and risk mitigation
    In his keynote speech of 4 September at the ECB Legal Conference, Frank Elderson discussed the rise of climate and environment-related litigation, which is increasingly targeting corporates, including in the financial sector. Such litigation is becoming a major source of risk that needs to be properly anticipated and managed by banks as well as supervisors. Elderson offered banks and regulators two strands of thought. The first is the 'bread-and-butter guidance': get up to speed on litigation trends and mitigate the associated risks for your institution, referring also to the Urgenda and Shell cases. The second refers to the importance of putting in place Paris-aligned transition plans while ensuring that an accurate data set and proper internal governance is in place.

    NGFS reports on climate-related litigation trends and micro-prudential supervision
    On 1 September, the Network of central banks and supervisors for Greening the Financial System (NGFS) published two complementary reports on climate-related litigation risks. The first report provides an update on the trends and developments in climate-related litigation risks and how this may affect the financial sector. It highlights that climate-related litigation is growing rapidly, in terms of the volume of cases being initiated as well as the legal arguments being used, and the diversity of the addressees of such claims. Such litigation can have a significant impact on the financial sector. The second report looks at how these developments need to be stressed from a supervisory perspective. The report highlights the important of supervisors identifying risk drivers, transmission channels and exposures in order to properly assess the resulting financial risks for financial institutions, and using a risk-based approach to prioritise supervisory activities.

    DNB President Klaas Knot calls for action to curb nature-related financial risks
    During his speech at the launch event of the NGFS reports, Klaas Knot urges for immediate action to assess and reduce the risks that the nature crisis poses to the economy and the financial system. "Services such as clean water, healthy air, food and materials are all essential to our economies and our very existence as humans. As central banks and supervisors, we have every reason to be concerned, because it’s an illusion to think we can preserve financial stability if this degradation continues." Knot stressed that starting now, working together and keeping all eyes on the summit are essential to make meaningful progress.

    USD 19 million settlement for greenwashing allegations by US financial supervisor
    The US Securities and Exchange Commission (SEC) announced that asset manager DWS has agreed to pay USD 19 million in order to settle the SEC’s allegations of ESG misstatements (greenwashing). The SEC alleged that DWS made misleading statements about its controls for incorporating ESG factors into research and investment recommendations for ESG-integrated products, including certain actively managed mutual funds and separately managed accounts.

    Hearings in ECtHR climate case of Duarte Agostinho and others v. Portugal and 32 other states
    On 27 September, the Grand Chamber of the European Court of Human Rights (ECtHR) held hearings in the climate case of Duarte Agostinho and others (Portuguese youth) v. Portugal and 32 other states. In this case, the plaintiffs claim that the defendants are failing to do their part to avert climate catastrophe, thus allegedly acting in breach of their obligations under the European Convention of Human Rights. A recording of the hearings is available here. During the hearings, the parties have amongst others responded to a number of questions (text in French) of the Grand Chamber. The Grand Chamber will now commence its deliberations on a decision in the case.

    ITLOS hearings on climate responsibilities of states towards the marine environment
    From 11 to 25 September, the International Tribunal for the Law of the Sea (ITLOS) held hearings on the responsibilities of states in regard to climate change under the UN Convention on the Law of the Sea (UNCLOS). More specifically, the hearings addressed the effects of climate change on the marine environment. The hearings follow the request of a group of island states on 12 December 2022 and have been recorded. The ITLOS is now deliberating on this matter and expects to issue its advisory opinion by early to mid-2024. The group of island states has also submitted requests for climate change-related advisory opinions to the Inter-American Court of Human Rights and the International Court of Justice.

  • September 2023

    Held v. Montana: state has active duty to realise right to clean and healthful environment
    On 14 August, in a case brought by 16 young citizens of Montana against Montana, the District Court of Montana held that the children have ‘the right to a clean and healthful environment’ and the state has an affirmative duty to take active steps to realise this right. The District Court declared a legal limitation included in Montana's State Energy Policy Act which forbids Montana from considering the impacts of greenhouse gas emissions and climate change in their environmental reviews to be unconstitutional.

    Climate litigation more than doubles in five years
    On 27 July, the United Nations Environment Programme (UNEP) published the Global Climate Litigation Report: 2023 Status Review. The report gives an overview of the state of climate change litigation and an update on global climate change litigation trends. The findings demonstrate a rapid growth in climate change litigation worldwide: from 884 cases in 2017 to 1,550 cases in 2020 and 2,180 cases in 2022. The report predicts a rise in the number of cases dealing with, amongst others, climate migration, pre- and post-disaster conditions, transnational responsibility and vulnerable groups disproportionately affected by climate change.

    ClientEarth appeals dismissal of climate risk mismanagement claim against Shell directors
    In the June edition of ESG Matters, we reported that the English High Court dismissed environmental organisation ClientEarth’s claim against Shell Plc and its directors. In an oral hearing on 12 July, ClientEarth requested the court to reconsider this judgment. The London court upheld the dismissal by judgment of 24 July, whereupon ClientEarth announced that it will appeal this decision.

    ClientEarth takes EU Commission to court for approving France’s agriculture plan
    ClientEarth and Collectif Nourrir have brought proceedings against the European Commission before the Court of Justice of the European Union. The claimants argue that the European Commission has unlawfully approved a French national agriculture plan. They require the European Commission to reassess the plan and require France to improve it.

    Greenpeace sues Dutch State for failure to protect nature against nitrogen damage
    On 12 July, Greenpeace launched legal proceedings against the Dutch State on the reduction of nitrogen emissions. Greenpeace claims that the Dutch State commits an unlawful act by failing to reduce nitrogen deposition in natural habitats and the habitats of species in the short term and by failing to present a plan to sufficiently and timely reduce nitrogen emissions. The hearings are expected to take place in 2024.

    Amsterdam Court of Appeal: flight-reduction Schiphol permitted
    On 7 July, in preliminary relief proceedings, the Amsterdam Court of Appeal (nullifying the District Court’s judgement in first instance) held that the intended measures of the Dutch State to reduce the amount of flights around Schiphol do not violate EU law. The claimants (including the International Air Transport Association and KLM) have the opportunity to appeal in cassation against the judgment.

  • July 2023

    Global trends in climate change litigation: 2023 snapshot
    On 29 June, the Grantham Research Institute published its 2023 report on ‘Global trends in climate change litigation’. This ‘2023 snapshot’ signals a strong increase in climate litigation filed against corporates, as greenwashing cases against corporates are particularly on the rise (see the previous ESG Matters). While litigation strategies show parallels across jurisdictions, the diversity in cases and the complexity of arguments and claims in general seems to be increasing.

    BEUC files complaint against airlines
    On 22 June, the Association of National Consumer Unions in Europe (BEUC) and 23 national consumer groups launched a complaint against 17 European airlines to the EC and the European Consumer Protection Authorities Network. BEUC calls for a legal investigation, maintaining that the airlines are misleading consumers through climate-related marketing claims. BEUC maintains, amongst others, that the airlines should cease their communications on sustainable flying and reimburse any green premiums paid by consumers.

    General Court dismisses appeal against the inclusion of nuclear and natural gas within the EU Taxonomy
    On 21 June, the General Court dismissed the action for annulment of Delegated Regulation 2022/1214 laying down the conditions under which nuclear and natural gas energy activities may be included in the list of economic activities covered by the Taxonomy Regulation (Case T-628/22). A Member of the European Parliament brought the action for annulment, claiming that that regulation infringed the Parliament’s legislative competence and, therefore, his rights as a Member of the Parliament. In its order, the General Court considers that the applicant does not have standing to bring the action because his rights connected with the exercise of the Parliament’s legislative competence are intended to be exercised only in the context of the Parliament’s internal procedures and cannot therefore be regarded as directly affected by the adoption of Delegated Regulation 2022/1214.

    AFM publishes draft guidelines regarding sustainability claims
    On 12 June, the AFM has put the Guidelines on sustainability claims up for consultation for financial institutions and pension providers. The purpose of these guidelines is to provide market participants with the tools to make correct, clear, and non-misleading sustainability claims. The consultation will run until 24 July. The ACM has issued - and recently revised - similar guidance.

    Amsterdam District Court: Fossielvrij admissible in claims against KLM
    On 7 June, the Amsterdam District Court held that Fossielvrij is admissible in its claims on green advertising against KLM. Fossielvrij was permitted to file  a submission by 5 July 2023 on the question of whether the specific advertisements on which the claims are based are still relevant

    Greenwashing in the financial sector: ESAs publish progress reports  
    On 1 June, the European Supervisory Agencies (ESAs) published their progress report on greenwashing risks in the financial sector. In these reports, EBA, ESMA and EIOPA arrived at common high-level understanding of ‘greenwashing’ with each ESA highlighting its current thinking of greenwashing and related risks in its respective sector.

  • June 2023

    London court dismisses claim against Shell directors
    On 12 May, the English High Court dismissed environmental organisation ClientEarth’s claim against Shell Plc and its directors. ClientEarth argued amongst others that the Shell directors owed and breached specific climate-related duties, including the duty to align Shell's risk strategy with the Paris Agreement. The High Court concluded that the Shell directors do not owe such specific duties under English law and dismissed the claim on the basis that ClientEarth has not made out a prima facie case for the relief sought. ClientEarth has asked and been granted an oral hearing to ask the court to reconsider the decision.

    EP approves Consumer Empowerment Directive proposal
    On 11 May, the European Parliament approved the proposal for a Consumer Empowerment Directive. The proposal will update the Unfair Commercial Practices Directive (2005/29/EC) and Consumer Rights Directive (2011/83/EU). According to the press release of the European Parliament, the primary objective is to assist consumers in making environmentally friendly choices and encourage companies to provide more durable and sustainable products. The Council of the European Union and the European Parliament will now start negotiations on the content and final wording of the directive.

    Inhabitants Bonaire and Greenpeace send letter of summons to Dutch State
    On 11 May, Greenpeace sent a letter of summons to the Dutch State, together with eight inhabitants of Bonaire. They demand that the Dutch State takes measures and develops policies to protect Bonaire against climate change. The inhabitants and Greenpeace threaten to start legal proceedings if the Dutch State does not reply to the letter before 23 June 2023 or if parties have not reached an agreement before 30 September 2023.

    Civil action of NGOs vs. ENI and large shareholders
    On 9 May, Italian NGOs Greenpeace and ReCommon and twelve Italian citizens initiated a civil lawsuit against energy company ENI. The plaintiffs state in a media briefing that they are requesting an order on ENI to reduce its group CO2-emissions by 45% in 2030 as compared to 2020 levels, and are asserting their right to claim a monetary penalty in case of non-compliance. The NGOs also sue the Italian Ministry of Economy and Finance as well as state-controlled investment bank Cassa Depositi e Prestiti in their capacity of ENI shareholders.

  • May 2023

    Milieudefensie v. Shell: joinder ‘Milieu en Mens’ foundation allowed
    On 25 April, the Court of Appeal of The Hague allowed the joinder (voeging) of the Milieu en Mens (M&M) foundation in the Milieudefensie v. Shell proceedings. On the same date, the request for joinder of Climate Intelligence Foundation (Clintel) was dismissed. M&M believes that Milieudefensie misuses the District Court’s judgment to pressure other Dutch organisations to comply with its climate demands. This leads to harm to citizens and businesses in the form of higher energy costs and prices. The case has been referred to the roll of 6 June to allow M&M to submit a statement.

    Greenwashing: chewing gum made of only natural ingredients?
    On 21 March, the Amsterdam Court of Appeal rejected a claim brought by chewing gum manufacturer Perfetti against its competitor Benbits in summary proceedings (for the ruling in Dutch, click here). Perfetti claimed that Benbits be prohibited from claiming that its chewing gum was made using only natural ingredients, because Perfetti considered such claims to be misleading and unlawful. Although rejected, this claim shows the potential of claims for greenwashing brought by competitors against each other.

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