JBS USA Settles NY AG “Net Zero” Challenge as NGO False Ad Litigation Continues and California Climate Reporting Deadlines Loom
On November 3, 2025, the New York Attorney General announced a $1.1 million settlement with the U.S. subsidiary of the world’s largest beef producer, ending the state’s lawsuit accusing the company of misleading the public about its environmental practices and sustainability commitments. The complaint, filed in February 2024 in New York state court, alleged that defendants JBS USA Food Company and JBS USA Food Company Holdings (together, JBS USA), and JBS USA’s parent, subsidiary, and affiliate companies, misled the public about a pledge to reduce greenhouse emissions and their stated goal to be “Net Zero by 2040.” However, JBS USA now faces a new false advertising challenge involving essentially the same claims, joining a growing number of companies getting sued over aspirational environmental claims.
These false advertising lawsuits come at a time when many companies are under pressure to make certain climate claims in the EU and the U.S., including to comply with new mandatory reporting requirements in California next year under SB 253 and SB 261. Starting on January 1, 2026, the latter will require biennial reporting of “climate-related financial risks” by certain companies (i.e., U.S. entities with total annual revenue exceeding $500 million doing business in California), including posting these reports on the company website. Meanwhile, SB 253’s first set of reports (on Scope 1 and 2 greenhouse gas emissions by U.S. entities with total annual revenue exceeding $1 billion doing business in California) are expected to be due by June 30, 2026. As these deadlines approach, companies should be aware of the recent challenges against JBS USA and others and they should make sure that any environmental and climate-related marketing claims align with the information included in required reports.
New York Attorney General Challenge
In its initial complaint, the New York Attorney General contended that JBS USA violated state consumer protection laws by making “sweeping representations to consumers” about environmental commitments and carbon-neutral goals, when, according to the New York Attorney General, the company had no actual plans to achieve that goal. In fact, per the complaint, a “Net Zero by 2040” goal was not feasible given existing agricultural practices and JBS USA’s current scale.
Of significance to advertisers, the complaint referenced a decision by BBB National Programs’ National Advertising Division (NAD), the self-regulatory body of the advertising industry, which resulted from a challenge to claims filed by the Institute for Agriculture & Trade Policy (IATP). The NAD determined that, although the company had taken some steps toward achieving its “net zero” goal, those steps were insufficient to substantiate the “Net Zero by 2040” claim and its advertised “operational plan” and “commitments.” On appeal, the National Advertising Review Board (NARB) agreed and requested that the company discontinue the “Net Zero by 2040” claim and modify related claims. In a subsequent compliance proceeding, NARB acknowledged the steps JBS USA had taken, but nevertheless concluded that the modified “Net Zero by 2040” claims should be removed.
At a hearing in January 2025 regarding the New York Attorney General’s complaint, the state court judge questioned whether aspirational claims such as “ambition” and “goal” were actionable under New York state law. The judge suggested that the complaint did not sufficiently allege a lack of plan or intent behind those claims, noting that JBS USA had undertaken “significant expenses and steps” toward its stated goals. The court granted the New York Attorney General 90 days to file an amended complaint. The parties later agreed to extend that deadline. A settlement was reached on October 31, 2025, in lieu of filing an amended complaint.
As part of the settlement, JBS USA agreed to modify certain U.S. consumer-facing statements by presenting “Net Zero by 2040” as a “goal” rather than a “pledge” or a “commitment.” The company will also disclose specific actions it is taking to achieve that goal, instead of broadly claiming it is “taking steps” or “taking real action.” Additionally, JBS USA agreed to conduct an annual “comprehensive internal review” of its statements related to the “Net Zero by 2040” goal for the next three years and to submit certificates of compliance to the New York Attorney General after each review. The $1.1 million settlement will support “climate-smart agriculture” programs in New York State. The settlement amount and the allowance of “goal” claims appear to reflect the court’s earlier doubts about the strength of the New York Attorney General’s legal theory of liability. However, JBS USA and other companies continue to face legal challenges regarding aspirational climate claims.
Private False Advertising Challenges Remain Pending
About a month before the settlement with the New York Attorney General was finalized, the advocacy group Mighty Earth sued JBS USA in D.C. Superior Court, seeking redress under the D.C. Consumer Protection Procedures Act (CPPA) for essentially the same aspirational claims at issue in the NAD/NARB dispute and the New York Attorney General’s lawsuit.
The choice of venue is almost certainly not random. In 2021, another nonprofit, Earth Island Institute, sued Coca-Cola over its sustainability ad campaign in D.C. Superior Court. The court initially dismissed the complaint on grounds similar to those cited by the judge in the New York Attorney General’s case against JBS USA, finding the challenged claims too vague and aspirational to support a cause of action. However, on August 29, 2024, the D.C. Court of Appeals reversed the lower court’s dismissal. Less than a month later, the nonprofit Environmental Working Group (EWG) sued Tyson Foods in D.C. Superior Court, challenging the company’s “climate-smart” ad campaign and “net zero by 2050” claims. In February 2025, the court denied Tyson’s motion to dismiss.
In contrast, an Illinois federal court recently dismissed with prejudice a consumer class action lawsuit against Mondelez International, finding a meaningful distinction between “climate neutral certified,” the actual claim on the product label, which was truthful and not deceptive, and “climate neutral,” the plaintiff’s shorthand reference to the challenged advertisement.
What’s Next?
While these cases unfold, companies should consider several key points. Surveys indicate that both consumers and business customers care about the environment. Furthermore, state laws—including extended producer responsibility (EPR) laws for packaging—require that products and packaging materials demonstrate certain environmental attributes, such as meeting standards for recyclability, compostability, recycled content, and source reduction, to name a few. These laws incentivize companies to make claims about their compliance with state requirements. Upcoming reporting deadlines in California under SB 253 and SB 261 will further compel companies to disclose information about various environmental aspects of their products, packaging, facilities, and operations. Meanwhile, environmental claims—including forward-looking and aspirational statements—continue to face challenges from a variety of sources: private plaintiffs, state regulators, competitors, and others, even as federal authorities deprioritize environmental regulation under the current administration.
It is now more important than ever for companies to carefully review, substantiate, and when necessary, qualify their environmental claims—both those that are aspirational and those that reflect today’s achievements—so that consumers and business customers receive truthful information about the environmental attributes and actions an advertiser is undertaking. Clearly, the choice of wording related to an advertiser’s aspirational environmental objectives is a crucial factor in how courts address legal challenges.