At King & Spalding, we are advising our clients on ESG issues every day. We are tackling our clients’ most pressing ESG matters and doing so while collaborating across industries and practice areas. Our attorneys in Corporate, Finance and Investments, Government Matters and Trial and Global Disputes are actively involved and ready to help our clients in this fast-moving area. Below are a few of the ESG issues, topics and developments that we have been thinking about as fall arrives.
- Patagonia Founder Gives Away Company to Help Fight Climate Crisis: Yvon Chouinard, the founder of outdoor apparel brand Patagonia, is giving away the company to a specially designed trust and non-profit organization that is dedicated to fighting the environmental crisis. The trust, called the Patagonia Purpose Trust, will ensure that the company’s profits are used to combat climate change. The Patagonia Purpose Trust will be overseen by family members.
- Illinois District Court Rules Claims Based on Unavailability of Recycling Centers Cannot Proceed Against 7-Eleven: The United States District Court for the Northern District of Illinois granted in part and denied in part defendant 7-Eleven, Inc.’s motion to dismiss in a putative class action alleging that certain of 7-Eleven’s store brand “24/7 Life” products were falsely and/or misleading marketed as “recyclable.” Plaintiff claimed that in reality, the products frequently are not recycled due to the small number of recycling facilities that accept the type of plastic from which the products are made, and further, the products lacked markings, known as RIC labels, without which the products cannot be recycled. The court dismissed the plaintiff’s claims relating to the unavailability of recycling facilities, noting that “’[r]ecyclable’ means ‘can be recycled,’” not that it “will” be recycled. The court, however, permitted claims to proceed to the extent they related to the allegedly omitted RIC labels.
- H&M Promises to Adjust or No Longer Use Sustainability Claims: Retailers H&M and Decathlon have stated they will adjust or no longer use sustainability claims on their clothes and/or websites, and will better inform consumers to minimize the risk of misleading practices concerning sustainability claims. H&M and Decathlon also will pay €400,000 and €500,000 respectively to “sustainability causes.” This follows an investigation by The Netherlands Authority for Consumer Markets (ACM) into sustainability claims that revealed that the retailers used terms such as “Ecodesign” and “Conscious” without stating the sustainability benefits with the claim, and ACM will continue to enforce the retailers’ compliance with their commitments.
- Democratic Treasurers Respond to Republicans’ ESG Positions: A coalition of fourteen Democrat officials have criticized new state laws that bar banks from public contracts due to their stances on guns and fossil fuels (Texas and West Virginia), as well as barring ESG investment strategies from public funds (Florida). The officials claim that the states will “fail to compete over the longer time horizon” and will miss growth potential.
- EU Green Finance Advisers Resign: Five non-profit civil society advisers resigned, claiming that the European Commission “interfered politically.” Specifically, the group claimed that their recommendations on topics including gas and nuclear power plants were ignored, despite being asked to assist with defining what the EU would label as a green investment.
In Case You Missed It
In case you missed them, linked below are some recent Client Alerts from King & Spalding on particular ESG-related legal developments along with other links of interest.