A coalition of 11 states, led by Texas, has filed a lawsuit against BlackRock, Vanguard and State Street, accusing the firms of manipulating coal markets to advance ESG policies. The suit claims these practices have harmed American consumers by raising energy prices and violating antitrust laws.
The lawsuit, filed in the Eastern District of Texas, alleges that the firms used their ownership in coal producers to suppress coal output, creating artificial scarcity. This strategy, the complaint argues, prioritized environmental goals over economic competition, leading to higher utility costs nationwide.
Texas Attorney General Ken Paxton described the companies as operating a “cartel” to rig the coal market. He stated, “Their actions have led to higher prices for American families while benefiting their profits.” The lawsuit also alleges that the firms misled investors by marketing funds as non-ESG while pursuing ESG strategies.
The complaint highlights programs like Climate Action 100 and Net Zero Asset Managers Initiative as central to the firms’ alleged coordination. These initiatives, the suit argues, were used to pressure coal producers into cutting output.
The states are seeking financial penalties, including $10,000 per violation under Texas law, as well as measures to prevent future market manipulation. The lawsuit also asks the court to impose injunctive relief to protect coal production and energy prices.
This legal action is part of a broader effort by Republican-led states to challenge the growing influence of ESG policies. It reflects a deeper pushback against financial practices that critics argue harm the U.S. economy and energy independence.
