Texas Judge Allows Antitrust Case on BlackRock Climate Policies to Move Forward

U.S. District Judge Jeremy Kernodle on Friday largely denied BlackRock Inc.’s motion to dismiss an antitrust lawsuit brought by Texas and 12 other Republican-led states that challenges the firm’s climate-related investment practices. In a ruling from federal court in Tyler, Texas, Kernodle allowed 18 of the 21 counts in the complaint to proceed, removing only three lesser claims. The states accuse BlackRock as well as State Street Corp. and Vanguard Group Inc. of colluding through climate-advocacy alliances to curb coal production, thereby driving up energy prices in violation of U.S. antitrust law. The decision keeps one of the most high-profile legal tests of environmental, social and governance strategies alive and positions the asset-management giants to face discovery on allegations that their coordinated policies distorted competition in energy markets. BlackRock has argued its participation in investor climate initiatives aims to protect long-term shareholder value and does not constitute unlawful coordination. The court’s order did not rule on the merits of the claims but sets the stage for a full trial unless the parties reach a settlement or the defendants prevail in future motions.