Over the last 18 months, the Securities and Exchange Commission (SEC) has managed to introduce their controversial climate disclosure rule, miss proposed deadlines, extend said deadlines, and form a wall between themselves and dishing out requested information by the federal government. Now, as the second proposed deadline to vote on the rule by October 31st approaches, talk of lawsuits that the rule could face has begun.
For months, numerous experts have weighed in on the various doctrines of which the rule seemingly runs afoul. George Mason Law Professor Donald Kochan highlighted two key legal doctrines that could specifically bring about legal challenges – the “major questions doctrine” and the “non-delegation doctrine.” Even a former SEC employee who worked on the proposal mentioned the immediate chance of litigation once the rule is finalized.
As investors continue to search for answers to their questions about the proposed rule, the virtual certainty of prolonged litigation means prolonged uncertainty for markets. It’s predicted that the final rule would face “immediate litigation that could take years to resolve,” leaving investors and consumers even further in the dark even longer.
As the months tick on without answers or insight from the SEC, it is increasingly apparent that the proposed rule is far-fetched and an overstep by an agency that needs to be tamed. The last thing investors need is a waiting game around a confusing rule destined for litigation with no end in sight.