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Energy & Sustainability Litigation Updates — April 2023

Regulatory Updates

President Biden issued the first veto of his presidency to preserve a Department of Labor rule concerning ESG investing that the Republican-dominated Congress voted to overturn. Specifically, this Department of Labor rule enables investment managers to incorporate ESG factors, including climate change, into their investment decisions. President Biden has now preserved this regulation despite Congressional disapproval, indicating the extent of his administration’s support for the practice of utilizing ESG factors when making investments, and telegraphing future support for additional activity in this space.


The SEC’s announcement of its six examination priorities for 2023 included “Environmental, Social, and Governance (ESG).” This topic had also featured on its 2022 list of examination priorities, demonstrating the SEC’s continued attention to this subject. Notably, in its description of its examination priorities, the SEC has now highlighted the issue of whether “ESG products are appropriately labeled,” potentially signaling an increased focus on policing “greenwashing” by companies and investment managers and advisors.


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Jacob H. Hupart is Co-Chair of the ESG Practice Group and a Member in the firm’s Litigation Section. He has a multifaceted litigation practice that encompasses complex commercial litigation, securities litigation — including class action claims — as well as white collar criminal defense and regulatory investigations. His clients sit in a variety of industries, including energy, financial services, education, health care, and the media.