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U.S. Court of Appeals Hands Victory to Retail Energy Advocate’s Challenge to SB1
Retail energy providers were wrongfully prevented from truthfully telling consumers about the environmental benefits of their products thereby harming consumer choice
In a press release, the Retail Energy Advancement League (REAL) announce that the retail energy choice advocates win free speech, renewable energy battle over Maryland legislation harming consumer options.
On May 15, REAL “announced a significant legal victory after the U.S. Court of Appeals for the Fourth Circuit ruled in favor of REAL and its co-plaintiff, Green Mountain Energy Company, in their challenge to Maryland’s Senate Bill 1 (2024).”
“The U.S. Court of Appeals Fourth District ruled that Maryland failed to demonstrate that the terms used to describe energy products are inherently misleading and deemed that the district court erred in denying the preliminary injunction requested by REAL and Green Mountain Energy Company.”
The court reversed the lower court’s decision in part and ordered a preliminary injunction against key provisions of Senate Bill 1 that prohibited retail energy suppliers from truthfully marketing their renewable energy products as “green,” “clean,” “100% renewable,” or other similar claims.”
The U.S. District Court for the District Of Maryland, Northern Division issued an order preliminarily enjoining the state and relevant agencies, including the Maryland Public Service Commission and Attorney General, from, “implementing, enforcing, or otherwise carrying out,” Section 7-707(c) of the Maryland Public Utilities Code, which includes provisions imposing a price cap on green power, and governing the marketing of green power products, such products’ green content, and required language for disclosures.”
“This is a significant win for free speech, consumer choice, and competitive energy markets,” said Chris Ercoli, president and CEO of the Retail Energy Advancement League.
“From the outset, Senate Bill 1 was a far-reaching attempt to limit consumer access to competitive energy choice. Maryland residents were promised consumer protection but instead got a law that stripped away their choices, forced customers off competitive products, drove suppliers out of the market, and blocked affordable electricity options — only for provisions of that same law to now be ruled unconstitutional.
“Today’s decision by the U.S. Court of Appeals vindicates the First Amendment right of suppliers to accurately sell electricity products to consumers.
Consumers benefit from energy suppliers providing truthful information —not arbitrary restrictions on how products can be explained, unless they are from government preferred sources. Competitive suppliers play an important role in expanding access to innovative, affordable and renewable energy options, and they must be able to communicate those offerings appropriately.”
“Today’s decision is a victory for consumer choice and free speech in Maryland,” said Thomas M. Johnson, Jr., co-chair of Wiley’s Issues and Appeals Practice, who argued the case for the Appellants. “Maryland SB1 prevented retail energy providers from truthfully telling consumers about the environmental benefits of their products unless the energy came from the government’s preferred sources. The court correctly concluded that when it comes to important and hotly contested public debates about clean energy, the people, not the government, get to decide.”
“REAL was represented by Wiley Rein LLP during this litigation process. Read Wiley’s press release of this ruling here.”
Docket: U.S. District Court for the District Of Maryland, Northern Division, Civil Action No. 1:24-cv-2820-JRR
