A PYMNTS Company

Judge Allows Antitrust Suit Against BlackRock, Vanguard, and State Street to Proceed

By  |  August 3, 2025

A federal judge in Texas has allowed the bulk of a high-profile lawsuit to move forward against three of the world’s largest asset managers, in a case that could reshape how major financial firms engage with environmental policy through their investments.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    According to Bloomberg, U.S. District Judge Jeremy Kernodle rejected efforts by BlackRock Inc., Vanguard Group Inc., and State Street Global Advisors to fully dismiss the lawsuit brought by Republican attorneys general from Texas and several other states. The case accuses the asset managers of colluding to limit coal production in the United States under the banner of sustainable investing.

    Kernodle ruled Friday that most of the antitrust claims may proceed, stating the states presented “enough circumstantial evidence” to suggest the firms “agreed to collectively pressure coal companies to reduce the output of coal” and to disclose information about future production. The judge did, however, dismiss portions of the case tied to alleged violations of individual state laws.

    Per Bloomberg, the lawsuit centers on the asset managers’ involvement in climate-focused investment coalitions, which the plaintiffs argue functioned as a de facto cartel. The states allege that these firms leveraged their significant holdings to drive down coal output, thereby restricting competition in the energy sector.

    Related: BlackRock, Vanguard and State Street Push to Dismiss Antitrust Lawsuit Over ESG Strategies

    In response to the court’s decision, the firms reiterated their defense. BlackRock dismissed the lawsuit as “absurd,” stating in a prepared comment that the claims are “not supported by the facts.” State Street said the case promotes a “new and dangerous antitrust theory” and warned it could create unwarranted risk for both investors and energy markets. Vanguard, for its part, expressed disappointment in the ruling but emphasized its intent to “vigorously defend” against the allegations.

    The legal action, spearheaded by Texas Attorney General Ken Paxton, accuses the asset managers of acting in concert to shape U.S. energy policy through coordinated investment strategies. Paxton heralded the judge’s ruling as a major development. In a statement, he accused the firms of forming “an investment cartel to illegally control national energy markets.”

    As the case moves forward, it could have far-reaching implications for how asset managers align investment portfolios with environmental and social goals. The lawsuit touches on the growing tension between sustainable investing and regulatory scrutiny, particularly in Republican-led states critical of ESG (Environmental, Social, and Governance) strategies.

    Source: Bloomberg