Texas Attorney General Ken Paxton filed a lawsuit against BlackRock, State Street Corporation, and Vanguard Group that alleges they conspired to artificially constrain the coal market through anti-competitive practices.
The case was filed in the United States District Court for the Eastern District of Texas, Tyler Division. A coalition of 10 other states joined the suit. Texas and other states have sued others previously over ESG policies that they have argued hurt the energy industry.
The lawsuit claims that the defendants leveraged their substantial stockholdings in every major publicly traded coal producer in the United States to influence corporate policies and restrict coal production. It alleges that this collective pressure, aimed at advancing “green energy” objectives, is part of a broader scheme to reduce coal output by more than 50% by 2030.
According to the filing, BlackRock, Vanguard, and State Street allegedly coordinated their efforts through initiatives such as Climate Action 100 and the Net Zero Asset Managers Initiative, signaling a unified intention to diminish thermal coal production. This strategy, the lawsuit asserts, has driven up electricity costs for Americans nationwide.
The lawsuit further accuses the defendants of misleading thousands of investors who chose non-ESG funds to maximize returns. Despite these representations, the funds allegedly pursued environmental, social, and governance (ESG) strategies that conflicted with their stated objectives.
The complaint argues that these actions amount to a conspiracy to violate federal antitrust laws, prohibiting shareholders from using their holdings to suppress competition. By deliberately restricting coal supply, the defendants allegedly increased prices, enabling them to secure extraordinary profits.
Tony Buzbee, principal of The Buzbee Law Firm and lead outside counsel for the case, described it as a “landmark antitrust case” and emphasized the stakes: “The total recovery in this case could amount to billions of dollars. Texans can’t and won’t tolerate this type of conduct any further. I am proud to stand with Attorney General Paxton to seek justice and relief for the citizens of the great State of Texas.”
