Eleven states, led by Texas, have filed a federal lawsuit against BlackRock, Vanguard and State Street, accusing the firms of conspiring to reduce coal production and harm American consumers. The suit alleges the companies used their ownership stakes in major coal producers to artificially suppress supply and inflate energy prices.

The lawsuit, filed in Texas’ Eastern District, claims the firms violated federal and state antitrust laws by advancing Environmental, Social and Governance (ESG) policies. These efforts allegedly prioritized a green energy agenda at the expense of market competition and consumer costs.

Texas Attorney General Ken Paxton stated, “Their conspiracy has harmed American energy production and hurt consumers. BlackRock, Vanguard and State Street formed a cartel to rig the coal market and raise prices.”

The complaint accuses the firms of weaponizing their influence through initiatives like Climate Action 100 to pressure coal companies into cutting output. According to the suit, these coordinated efforts led to higher utility bills for American families while boosting the firms’ profits.

The legal action also alleges that the companies misled investors by applying ESG strategies to non-ESG funds, undermining shareholder expectations. “Their war on competition has consequences for the entire industry,” Paxton said, emphasizing the broader economic impact.

Joining Texas in the lawsuit are Alabama, Arkansas, Montana and eight other states. The suit seeks financial penalties, injunctive relief and measures to prevent future market manipulation, signaling a broader pushback against ESG-driven policies.