The legal environment surrounding corporate environmental and social claims is challenging companies to navigate an uncertain legal landscape due to varying global regulations and active third-party litigation
Key insights:
-
-
Litigation risk is evolving — Greenwashing litigation is rapidly increasing and evolving worldwide, with different drivers and enforcement priorities across regions, including NGOs in the EU and consumer class actions in the US.
-
Compliance becoming more challenging — Companies, especially multinationals, face heightened legal risks and complexity due to the lack of global alignment on sustainability regulations and standards, making compliance more challenging.
-
Proactive legal consultation is essential — Early legal guidance and comprehensive training for corporate teams are essential to help businesses navigate this shifting landscape, ensure compliance, and mitigate the risk of costly greenwashing claims.
-
Navigating the nuanced world of corporate sustainability claims has become more treacherous in 2025, as businesses face a proliferation of greenwashing lawsuits driven by distinct regional pressures and shifting enforcement priorities.
Indeed, the greenwashing trends are multifaceted with changes across regions and industries, as well as the expansion of which parties are bringing litigation, according to legal experts from Morgan, Lewis & Bockius. For example, private consumer-based litigation remained robust in the United States, despite changes in federal enforcement priorities, according to Carl Valenstein, a Partner in International Transactions, Finance and Trade at the firm.
In the European Union, non-governmental organizations (NGOs) are driving litigation because of new EU regulations regarding green claims and consumer protection, according to Daja Apetz-Dreier, Partner & Co-Leader of the ESG & Sustainability Advisory Group at Morgan Lewis. “We see an increase in NGOs being very active because there is a pushback on sustainability as a whole, and the different governments around the world push now even harder in relation to greenwashing or even climate change litigation,” Apetz-Dreier explains.
In addition, greenwashing claims continue to proliferate across several key industries, according to Franco Corrado, a Morgan Lewis litigation partner and his peers. Oil and gas, consumer products, and transportation sectors, in particular, are facing added scrutiny, Corrado adds.
Consumer class actions and NGOs filling void
In the US, litigation activity by class action attorneys, NGOs, and state attorneys general has picked up in 2025 during a time in which federal enforcement has pulled back, according to Valenstein. More specifically, Corrado says he continues to see NGO-driven consumer litigation and NGOs taking advantage of consumer protection laws that permit derivative claims on behalf of consumers to seek injunctive relief to stop false advertising practices. “Consumer class actions are targeting companies for the presence of contaminants like microplastics and PFAS” in a range of products from food packaging to apparel have proliferated, he adds.
In the area of supply chain integrity, Valenstein notes an increase in the US of civil litigation under the Victims of Trafficking and Violence Protection Act of 2000 to attack forced labor in the supply chain, which has led some companies to settle before such lawsuits are filed to sidestep negative publicity. In addition, there is more consumer protection class-action litigation challenging the reasonableness of reliance by companies on third-party supply chain audit firms, he says.
Further, companies are exercising caution in their diversity, equity & inclusion (DEI) public statements to avoid drawing negative attention. “I think that the DEI space is unique in terms of complexity,” Valenstein says. “Companies are worried about action from the federal government, but they’re also worried about litigation from stakeholders who feel disappointed that companies are walking back and no longer honoring commitments.”
Greenwashing claims around statements regarding net zero commitments is still a key area of litigation as well. For example, companies in the airlines industry are being targeted for “emission statements and carbon neutrality goals,” in which the legal theory is that “these statements induced consumers to… pay a premium” under false pretenses, Corrado explains.
Outside assistance necessary to manage legal risk
Multinational companies are particularly challenged by the varying regulations and legal risks across different countries because of the lack of global alignment around sustainability laws and standards. “The big challenge for multinationals is that in the past, there was an alignment globally by most administrations and governments,” says Apetz-Dreier. “But this is now changing. It is a big challenge to comply with the different national approaches and regulations.”
As companies seek to align their practices with new areas of legal risk exposure, Corrado, Valenstein, and Apetz-Dreier advise companies to consult proactively with legal counsel for guidance and training. For example, they suggest that legal counsel from several multidisciplinary areas review the company’s sustainability reports, website copy, product labels, and marketing messages before any product launch to better mitigate the murky multi-layered divergence in the legal landscape. Indeed, Valenstein describes the holistic approach he and his peers use with clients: Companies approaching outside counsel with the expertise in litigation, regulatory & compliance, and antitrust is a best practice, he explains.
They also recommend hiring external experts to conduct training sessions for corporate marketing department teams to better equip them with the necessary awareness and skills to craft messages that are both appealing to consumers and legally sound. By doing so, companies can balance their marketing strategies with compliance requirements and reduce the risk of facing costly legal disputes. Corrado describes how bringing in external experts to review “real world examples of claims and statements that seemed innocuous but led to litigation” helps to “recalibrate the marketing department’s view” on how their words can open up the company to risk exposure.
As the landscape of environmental claims continues to shift, companies must brace themselves for anticipated trends in both greenwashing legal claims and regulatory changes. “We are living in a very quickly evolving legal environment and it’s important for our clients to be prepared for the unknown because there is a lot of insecurity about what is going to happen,” says Apetz-Dreier. “We prepare our clients for the different opportunities and challenges — that’s a big part of our work.”
You can learn more about the concept of greenwashing here
