BlackRock, State Street and Vanguard have been accused by Texas and 10 other Republican-led companies of violating antitrust laws through climate action efforts that have led to a decline in coal production and higher energy prices. He is being sued by the state.
Wednesday's complaint, filed in federal court in Tyler, Texas, is one of the highest-profile lawsuits targeting efforts to promote environmental, social, and governance goals (ESG).
Defendants exploited their market power and involvement with climate change advocacy groups to pressure coal companies to reduce production and reduce carbon emissions from coal by more than 50% by 2030. He was accused of driving up consumers' utility bills.
“Competitive markets should determine the prices Americans pay for electricity, not the dictates of some distant asset manager,” the states wrote in their complaint.
Larry Fink's BlackRock, State Street and Vanguard collectively manage more than $26 trillion in assets.
None of the companies immediately responded to requests for comment.
The 11 states also include Alabama, Arkansas, Indiana, Iowa, Kansas, Missouri, Montana, Nebraska, West Virginia, and Wyoming.
Republicans have long considered using U.S. antitrust laws to target alleged collusion among big fund managers to advance climate-related goals.
In contrast, climate change advocates believe that assessing environmental risks is essential to assessing the value of investments.
Large investment in coal companies
States objected to BlackRock, State Street and Vanguard's alleged efforts to pressure coal companies to change starting in 2021.
They also criticized the defendants' membership in the Net Zero Asset Managers Initiative. committed compliance with all antitrust laws, and membership in BlackRock and State Street's Climate Action 100+.
Vanguard withdrew from the Net Zero Initiative in 2022, and BlackRock and State Street withdrew from Climate Action 100+ in February.
But the states said the withdrawal would not negate “current and future threats” from continued pressure.
The court cited defendants' investments in nine coal companies, including a combined 34.2% and 30.4% stake in Arch Resources and Peabody Energy, the largest publicly traded coal producers in the United States, respectively.
BlackRock also allegedly used all of its stock holdings to advance climate change goals, and the lawsuit accuses it of “actively deceiving” investors by promising to use non-ESG funds to drive shareholder value. It was done.
The lawsuit prevents BlackRock, State Street, and Vanguard from using their investments to vote on shareholder resolutions or taking other actions that could harm coal production or limit market competition. I'm asking you to do something.
It also seeks civil penalties for violating federal antitrust laws and Texas consumer protection laws.
The case is State of Texas et al. v. BlackRock Inc. et al., United States District Court, Eastern District of Texas, No. 24-00437.
