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BlackRock fails to dismiss Texas climate conspiracy claims

A U.S. Judge on Friday rejected in large part a request from top asset managers, including BlackRock, to dismiss a suit filed by Texas and twelve other Republican-led States that claimed the companies had violated antitrust laws through climate activism which reduced coal production and increased energy prices.

U.S. district judge Jeremy Kernodle, in Tyler, Texas, agreed to dismiss only three of the 21 count in the states' suit, which also names institutional investors State Street, Vanguard, and others.

This is one of the most high-profile lawsuits aimed at promoting environmental, social, and governance goals.

Requests for comment from the companies were not immediately responded to by representatives.

Kernodle was appointed by Donald Trump and his ruling means that states can continue with their claims against asset managers for violating U.S. Antitrust Law by joining Climate Action 100+ an investor initiative to take actions to combat climate changes, as well as using their shareholder advocacy to further its goals.

The companies deny wrongdoing, and have called the case "half baked." The theories of the states were supported by Trump's antitrust enforcers, who are now at the U.S. Department of Justice (DJ) and Federal Trade Commission.

The result of the case could have major implications on how companies that together manage $27 trillion in passive funds and holdings approach their investments.

BlackRock, the fund firm that is suing the plaintiffs, has stated that the plaintiffs could seek a remedy by asking the fund firms not to hold coal companies. This would likely increase energy prices and harm companies' access capital. Reporting by David Shepardson and Jody Godoy, both in Washington; editing by David Holmes

(source: Reuters)