SEC PROPOSED CLIMATE DISCLOSURES: PREPARING FOR A NEW ERA OF CLIMATE LITIGATION IN IDAHO AND BEYOND.

It did not take long for Oatly to falter beneath the unblinking eye of investors. Within two months of going public, the global oat milk company faced multiple allegations of securities fraud. Oatly had merely intended to reassure investors: "sustainability is at the core of our business." Instead, those eight words became kindling for litigation. Without pause, investors filed a class-action lawsuit in a New York federal district court alleging the company misled investors about its environmental practices and artificially inflated its stock price. For Oatly, it was an unexpected welcome to a new era of climate litigation. The story of Oatly's slip-up is an increasingly common narrative in climate-related litigation. As investor interest in sustainability grows, so does the risk of liability for public companies and directors. Attempts to mitigate the litigation risks are costly, but ignoring the risk carries even greater, perhaps even crippling, costs. True, companies have long been willing to volunteer climate information to investors in their sustainability reports, recognizing the reduction in risk premiums associated with such disclosures. But investors have challenged those disclosures as avalanches of information lacking meaningful, actionable data. Indeed, investors and directors alike are often left "drowning in information, while starving for wisdom. This paper addresses a new era of climate litigation, exploring the well-traveled private causes of action for securities fraud against the backdrop of the SEC's proposed climate disclosure rules. As written, the rules greatly expand the disclosure requirements for public companies. In doing so, the proposed rules also extend the footholds for private plaintiffs seeking to mount a securities class-action lawsuit. This paper analyzes these increased disclosure demands in the context of a historic reallocation of investment capital and the nascent ESG movement. Recognizing these climate-change efforts punch forward with considerable momentum, this paper provides solutions for public and private companies alike to prepare for and succeed in an expanding and uncertain climate litigation arena. [ABSTRACT FROM AUTHOR]