WASHINGTON, D.C. — There’s more bad news for New Jersey Governor Phil Murphy and Democrats in Trenton pushing a 2035 gasoline powered car ban and EV mandate.
The U.S. Supreme Court ruled 7–2 that American fuel manufacturers have legal standing to challenge California’s electric vehicle mandates, a decision that clears the way for industry groups to move forward with a high-profile lawsuit against the Environmental Protection Agency (EPA) and the state of California.
The ruling stems from the case Diamond Alternative Energy, LLC v. EPA, in which fuel producers—led by the American Fuel & Petrochemical Manufacturers (AFPM)—argue that the EPA’s waiver allowing California’s Advanced Clean Cars I (ACCI) program exceeds lawful regulatory authority.
“Today the Supreme Court put to rest any question about whether fuel manufacturers have a right to challenge unlawful electric vehicle mandates,” said Chet Thompson, President and CEO of AFPM. “We do, and we look forward to finally having our day in court.”
Legal challenge centers on California’s ACCI policy and similar policies in New Jersey
The underlying dispute involves California’s ACCI rules, adopted in 2012, which require auto manufacturers to meet annual sales targets for zero-emission vehicles and impose strict greenhouse gas standards for model years 2018 through 2025. The rules apply not only in California but also in more than a dozen other states that have adopted California’s standards under Section 177 of the Clean Air Act.
AFPM contends that Congress never granted California special authority to enforce EV mandates or ban gas-powered vehicles and argues that the EPA overstepped by approving the waiver.
The case, argued before the Supreme Court on April 23, 2025, now returns to a lower court for review on the merits of the fuel industry’s claims.
The Supreme Court’s decision affirms that fuel producers may challenge California’s EV rules, setting the stage for a legal battle over the future of vehicle emissions policy in the U.S.