The Department of Justice filed an amicus brief supporting Texas Attorney General Ken Paxton’s lawsuit against BlackRock, State Street, and Vanguard for allegations of antitrust violations.
Paxton filed the lawsuit against the three investment companies “for conspiring to artificially constrict the market for coal through anticompetitive trade practices.” The three companies face allegations of using their massive holdings in major coal producers to pressure them to satisfy green energy goals with a push to more than halve coal production by 2030.
In the lawsuit, the Republican attorney general accuses the companies of deceiving investors who invested in non-environmental, social, and governance funds, a framework used to assess a company’s environmental sustainability impact, and raising prices by artificially constricting demand, alleging that the companies broke Texas antitrust laws.
“Texas will not tolerate the illegal weaponization of the financial industry in service of a destructive, politicized ‘environmental’ agenda. BlackRock, Vanguard, and State Street formed a cartel to rig the coal market, artificially reduce the energy supply, and raise prices,” Paxton said in announcing the suit. “Their conspiracy has harmed American energy production and hurt consumers. This is a stunning violation of State and federal law.”
The Justice Department and Federal Trade Commission said they share an interest in “ensuring the correct application of the antitrust laws, including in America’s energy markets.”
“Doing so protects Americans from anticompetitive behavior that reduces the production of domestic energy, raises energy prices for consumers and businesses, and undermines America’s energy dominance,” the brief stated. “It also preserves competition for capital investments, providing Americans with broader and more efficient investment options.”
The brief also cites Trump’s energy national emergency, which describes the nation’s “energy and critical minerals (‘energy’) identification, leasing, development, production, transportation, refining, and generation capacity” as “far too inadequate” to meet the country’s needs. The emergency text adds that “our Nation’s inadequate energy supply and infrastructure causes and makes worse the high energy prices that devastate Americans, particularly those living on low- and fixed-incomes,” central to Paxton’s argument and the amicus brief’s statement of interest.
Two energy experts that have been sounding the alarm on ESG for years reacted to the amicus brief filing in statements to the Washington Examiner.
“For anyone who has followed the development of ESG investing over the years, there is no question that BlackRock, State Street and Vanguard and other any institutional investors around the world have illegally colluded to advance the immoral climate agenda for their ideological and profiteering purposes,” Steve Milloy, senior fellow at the Energy and Environment Legal Institute and former Trump EPA Transition team member, said. “Much credit goes to Texas for taking the lead in pushing back against this anti-American criminality and more props go to the Trump administration for joining in to stop it on a national, if not international level.”
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James Taylor, president of The Heartland Institute, said, “Free markets and the rights of American consumers are being destroyed by an oligarchy of woke activist fund managers who are making an end run around democratically elected policymakers. Ken Paxton’s action is a powerful and long overdue step to rain in these out-of-control forces.”
The lawsuit comes as Paxton is running for Sen. John Cornyn’s (R-TX) seat in the upper chamber.
