The Federal Trade Commission (FTC) and the Department of Justice (DOJ) filed a Statement of Interest in a lawsuit accusing asset managers BlackRock, State Street, and Vanguard of attempting to manipulate the energy market.
According to a statement from the FTC, the lawsuit alleges that the asset managers “engaged in an anticompetitive conspiracy to drive down coal production as part of an industry-wide ‘Net Zero’ initiative to further anti-coal Environmental, Social, and Governance (ESG) goals.”
“President Donald Trump understands the importance of coal for our energy security and has vowed to fight left-wing ideologues who seek to make us weaker and poorer under the guise of ESG. Today, the Federal Trade Commission carries out this administration’s mission to unleash American energy dominance, protect coal, and stop the left’s attempt to corrupt financial markets with political and social objectives,” FTC Chairman Andrew Ferguson said. “These companies allegedly blocked the production of American coal in the name of climate change scaremongering, all so they could take money out of the pockets of American consumers and put it in theirs.”
The Statement of Interest affirms that the managers and investors may be held liable under Section 7 of the Clayton Act “when they use their stock holdings in multiple competitors to achieve anticompetitive goals,” the FTC noted.
The lawsuit, filed last November and led by Texas Attorney General Ken Paxton, alleges that the firms have an “output-reduction syndicate” that led to “supra-competitive profits for themselves and their portfolios,” violating state antitrust laws and Section 1 of the Sherman Act.
The alleged effort to limit coal production stands in contrast to President Trump’s executive order revitalizing the coal industry. “It is the policy of the United States that coal is essential to our national and economic security,” the order says. “It is a national priority to support the domestic coal industry by removing Federal regulatory barriers that undermine coal production, encouraging the utilization of coal to meet growing domestic energy demands, increasing American coal exports, and ensuring that Federal policy does not discriminate against coal production or coal-fired electricity generation.”
BlackRock responded to the Statement of Interest, saying, “The DOJ and FTC’s support for this baseless case undermines the Trump Administration’s goal of American energy independence.” The entity added that forcing the divestment from coal companies will “harm their ability to access capital and invest in their businesses and employees, likely leading to higher energy prices.”
