Texas sues investment firms for alleged antitrust violations

AUSTIN (KXAN) — Texas is suing three major investment firms, alleging the companies violated antitrust laws, making you pay more for electricity. The suit claims this happened through climate activism, which in turn reduced coal production and caused energy prices to rise.

Texas is one of 10 states suing Black Rock, Vanguard and State Street.

“This is a federal antitrust case. These things are complicated,” said University of Texas law professor Randy Erben.

Paxton joined 10 other state attorneys general to sue three of the biggest investors in the world. At stake, the suit claims, is by controlling the supply of coal, they caused fuel prices to rise.

“The claim is that they have pushed green energy policies that would reduce the production of coal,” explained Erben.

The lawsuit also alleges that “these firms defrauded thousands of investors in non-environmental, social and stewardship funds in order to maximize their profits.”

“You have three very powerful investment houses that will be very well represented by very good lawyers,” Erben said.

Erben also notes that this is something that will take a long time to get through the courts.

“It will probably take several years to get a final resolution unless they reach a settlement,” he said.

In a statement, Black Rock said in part: “The suggestion that Black Rock has invested money in companies with the intention of harming those companies is baseless and defies common sense. This lawsuit undermines Texas’ pro-business reputation and discourages investment in companies that consumers rely on.”

A State Street statement said the lawsuit is “baseless and we look forward to presenting the facts through the legal process.”

“State Street acts in the long-term financial interests of investors with a focus on increasing shareholder value. As long-term providers of capital, we have a mutual interest in the long-term success of our portfolio companies,” the statement read in part.

A slow process that may be years away from a solution.

“For the average consumer, will this change their electricity bill overnight? Probably not. It just depends on the resolution of this case,” Erben said.

KXAN also reached out to Vanguard for comment. The company has not responded. This story will be updated if a response is received.

You can read the entire trial here.