Together, these decisions highlight a period of active judicial engagement with federal agencies—reining in some, supporting others, and shaping the boundaries of environmental governance as largescale landuse and clean energy projects accelerate.scale landuse and cleanenergy projects accelerate. 

Disputes Over Federal Climate Grants is a Contract Issue 

The Fourth Circuit Court of Appeals has vacated injunctions that had prevented federal agencies from freezing or terminating climaterelated grants awarded under the Inflation Reduction Act and similar programs. The court found that the disputes were essentially contractual and therefore outside the jurisdiction of the federal district court. The court stressed that the Administrative Procedure Act’s narrow waiver of sovereign immunity cannot be used to enforce moneypayment obligations reframed as administrative claims, and that plaintiffs’ constitutional theories were simply statutory claims dressed in constitutional language. The ruling reinforces a tightening judicial view of lowercourt authority in federal funding disputes.

International Climate Prosecutions

According to recent updates from the Sabin Center’s Climate Litigation Database, late January brought a wave of fresh prosecutions abroad—including multiple environmentalcrime cases filed by Brazilian federal authorities. These additions reflect a steadily expanding global enforcement landscape, showing that climate litigation today increasingly includes localized and even criminal allegations involving pollution, land use, and environmental harm alongside the highprofile constitutional and administrative challenges that have long dominated the field.

All the Pretty Horses

January 2026 produced several significant rulings on the environmental front. In Friends of Animals v. Burgum, the Ninth Circuit upheld the Bureau of Land Management’s approval of a privately operated offrange corral capable of housing up to 4,000 wild horses and burros, affirming wide agency discretion in wildhorse management.

Forest Lump

Environmental plaintiffs found success, however, in Oregon Wild v. U.S. Forest Service, where a federal district court ruled that the Forest Service had improperly relied on a categorical exclusion under NEPA to greenlight commercial thinning projects in the Fremont–Winema National Forest. The decision underscores judicial skepticism toward agency attempts to streamline forestmanagement approvals without full environmental review.

Mighty Wind

Meanwhile, in the energy sector, a federal district court issued a preliminary injunction in Virginia Electric & Power Co. v. U.S. Department of the Interior, blocking the Bureau of Ocean Energy Management from suspending work on a major offshorewind project off the Virginia coast. The ruling signals courts’ growing reluctance to allow abrupt administrative reversals that could disrupt multibilliondollar clean energy investments.

Together, these decisions highlight a period of active judicial engagement with federal agencies—reining in some, supporting others, and shaping the boundaries of environmental governance as largescale landuse and clean energy projects accelerate.scale landuse and cleanenergy projects accelerate.

A Good Day for Drinking Water

The U.S. Court of Appeals for the D.C. Circuit rejected the EPA’s attempt to retreat from several portions of the national PFAS drinkingwater rule, declining to vacate the regulation’s strict Maximum Contaminant Levels. The underlying merits were far too contested to justify shortcircuiting the litigation, the court said, effectively keeping in place the rule’s most protective limits while the case proceeds. The next day, the same court refused to strike the Hazard Index portion of the rule—covering PFHxS, PFNA, GenX, PFBS, and related mixtures—and instead directed EPA to clarify exactly which provisions it still intends to defend. Together, the rulings sharply limit the new administration’s efforts to narrow PFAS regulation midcase and maintain regulatory pressure on water utilities, states, and industrial dischargers.

Judge Eyeballs PFAS Settlement Size and Efficacy

In New Jersey, a federal judge is closely examining nearly $3 billion in proposed PFAS settlements involving DuPont, Chemours, Corteva, and 3M. The court has pressed the state for assurance that the settlement figures are justified, that the funds will appropriately aid municipalities and utilities facing costly PFAS contamination, and that liability releases are not overly broad. Local governments have voiced concern that the deals could leave them responsible for significant cleanup costs despite the historic settlement totals. The judge’s unusual level of scrutiny signals a new era of judicial oversight for large environmental agreements, ensuring they withstand publicinterest review rather than simply reflecting negotiated numbers.

Together these developments show PFAS litigation entering a more assertive—and less predictable—phase: courts are blocking regulatory rollbacks, insisting on transparency and rigor in massive settlement agreements, and shaping the boundaries of PFAS accountability in ways that will influence manufacturers, water systems, insurers, and regulators throughout 2026.

Pollution by Any Other Name

The Illinois Supreme Court on Jan. 23, 2026 delivered a decisive clarification on the scope of the pollution exclusion in general liability policies. The court held that stateissued permits authorizing emissions have no bearing on whether the exclusion applies. In litigation arising from decades of ethylene oxide releases at a Willowbrook sterilization facility, the court rejected policyholder arguments based on regulatory authorization and reaffirmed that such emissions fall squarely within “traditional environmental pollution” under Koloms. Courts may not insert conditions into CGL policies that the parties did not, the court held. The carriers in the case, therefore, did not owe defense or indemnity. Griffith Foods International, Inc. v. National Union Fire Insurance Company of Pittsburgh, PA, Ill. Sup. Ct., 2026 IL 131710.

The exclusion ruling has generated robust commentary from attorneys. Policyholderside lawyers focused on the opinion’s analytical gaps and realworld consequences, while insuranceindustry attorneys—though generally pleased—also offered substantive observations about how the ruling clarifies longstanding uncertainty.