By Shivani Tanna and Ross Kerber
(Reuters) – BlackRock, Vanguard and State Street asked a Texas court late on Monday to dismiss a U.S. state lawsuit accusing them of conspiring to decrease coal output, saying the allegations were “half-baked and untested” legal theories.
“To find that Plaintiffs have stated an antitrust claim on these alleged facts requires contorting the law in a way that would hurt both coal companies and individual investors,” the asset managers told the judge, asking the court to reject this “adventurous attempt to rewrite antitrust law.”
The companies said that the complaint, led by the Texas state government, does not offer any example of them ever telling a coal company to reduce output.
BlackRock, Vanguard and State Street together manage more than $26 trillion in assets. Their influential proxy votes have made them major voices in how U.S. corporations pay executives, elect directors and set environmental, social and governance (ESG) policies.
But their reach has also generated criticism from various political perspectives. The suit is part of a wave of pressure on the firms from conservative U.S. politicians, many from energy-producing states, who among other things have alleged that the firms’ cooperation in industry net-zero groups amounts to collusion.
The claim is at the center of the suit filed by Texas and 10 other Republican-led states, which said the three violated antitrust law through climate activism that reduced coal production and boosted energy prices.
In their response the companies called their activities “commonplace” ones for their index funds that are “the core ingredients allowing asset managers to provide the low-cost funds that millions of Americans rely on to save for retirement and other purposes.”
The case is Texas et al v BlackRock Inc et al, U.S. District Court, Eastern District of Texas, No. 24-00437.
(Reporting by Ross Kerber in Boston and Shivani Tanna in Bengaluru; Editing by Muralikumar Anantharaman)
