Texas Attorney General Files Lawsuit Against Investment Firms for Market Manipulation
In a recent legal development, Texas Attorney General Ken Paxton, along with attorneys general from ten other states, has filed a lawsuit against major investment firms BlackRock, State Street Corporation, and Vanguard. The lawsuit alleges that these firms manipulated the energy market by using their large stockholdings in coal producers to push for a reduction in coal production in support of “green energy” initiatives.
The accusations are quite serious, claiming that the firms colluded to cut coal output by more than half by 2030 and artificially raise energy prices. Paxton’s office asserts that this market manipulation has resulted in significant financial gains for the investment firms. Paxton was quoted by KVUE saying, “Texas will not stand for the illegal use of the financial industry to push a harmful, politically motivated ‘environmental’ agenda.”
According to details from The Dallas Morning News, these actions are alleged to violate the Clayton Antitrust Act of 1914, which prohibits stock acquisitions with the intent to reduce competition significantly. The lawsuit specifically points to the involvement of these energy firms in climate groups like Climate Action 100+ and the Net Zero Asset Managers Initiative as part of an effort to drive industry-wide reductions in coal production.
BlackRock, the only defendant to respond immediately, has vehemently denied the allegations. In a statement to KVUE, they stated, “The claim that BlackRock has invested funds with the purpose of causing harm to those companies is unfounded and illogical.” BlackRock argues that its investments are regularly reviewed by regulatory bodies and made in the best financial interests of their clients.
State Street and Vanguard have not yet issued public responses to the lawsuit. This legal action highlights the growing tension between state officials and Wall Street regarding the alignment of investments with environmental considerations, which is a key aspect of responsible corporate governance in today’s market environment.
