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Texas v. BlackRock

State of Texas, et al. v. BlackRock, Inc., State Street Corporation, and The Vanguard Group, Inc.

States accuse BlackRock and State Street of colluding to cut coal output

At stake
Unquantified
Score
82.7Out of 100
Latest event
Sep 18, 20268 days ago
Next step
Not scheduledNothing dated on the record yet
Commenced
Nov 20241 yr 10 mo ago
Court
E.D. Tex.6:24-cv-00437-JDK

Stage

Pre-trial. Motions, discovery and case management before any trial. How cases are placed

  1. Filed
  2. Pre-trialNow
  3. Trial
  4. Decision
  5. Appeal
  6. Enforcement

Texas-led Republican states accuse BlackRock and State Street in federal court in Texas of using coal-company stakes to coordinate output cuts, in violation of antitrust law. The court largely denied dismissal in August 2025, Vanguard settled for $29.5M in February 2026, and the two remaining defendants have moved for judgment on the pleadings. In September 2026, Bloomberg reported that the Justice Department is weighing joining the suit.

Latest development Sep 18, 2026

On September 18, 2026, Bloomberg reported that senior officials at the Department of Justice (DOJ) have discussed formally joining the states’ suit against BlackRock and State Street. Other outlets carried similar reports. Joining as a party would take federal involvement beyond the statement of interest that the DOJ and the Federal Trade Commission filed in May 2025.

Why it matters

The case tests the “common ownership” antitrust theory: whether asset managers holding stakes across competing companies can violate antitrust law through coordinated climate engagement. The outcome could affect how BlackRock, State Street, and other passive investors vote and engage with portfolio companies across the economy.

Background

In November 2024, a coalition of Republican state attorneys general, led by Texas, filed an antitrust suit in the U.S. District Court for the Eastern District of Texas. The suit named BlackRock, Inc., State Street Corporation, and The Vanguard Group, Inc. as defendants. According to the states, the three firms are the largest shareholders in most major publicly traded U.S. coal producers. The states allege that the firms used those combined stakes to pressure coal companies into coordinated output reductions. They allege that the firms also used their membership in climate initiatives such as the Net Zero Asset Managers alliance and Climate Action 100+ for that purpose.

The states claim violations of the Sherman Act, the Clayton Act, and state antitrust and consumer-protection laws. They contend that the resulting supply constraints drove up electricity prices for consumers. In January 2025, 13 states filed an amended complaint expanding the antitrust and consumer-protection allegations. The asset managers moved to dismiss. They argued that they acted as passive, fiduciary investors, that the states pleaded no plausible agreement among them, and that antitrust law does not reach mere common ownership.

In May 2025, the Federal Trade Commission (FTC) and the Antitrust Division of the U.S. Department of Justice (DOJ) filed a joint statement of interest. The filing backed the states’ theory that common ownership combined with coordinated engagement can violate the antitrust laws. On August 1, 2025, Judge Jeremy D. Kernodle largely denied the motions to dismiss. The court allowed the core antitrust conspiracy claims to proceed but dismissed a handful of counts. The states filed a second amended complaint in January 2026.

In February 2026, Vanguard settled, agreeing to pay $29.5M, expand an “investor choice” program, and withdraw its U.S. businesses from groups that set climate-related investment or emissions targets. On February 26, 2026, the court dismissed all claims against Vanguard with prejudice. BlackRock and State Street, the remaining defendants, have since moved for judgment on the pleadings. The case remains pending before Judge Kernodle. In September 2026, Bloomberg and other outlets reported that the DOJ is weighing whether to join the states’ suit as a party, which would escalate federal involvement.

Timeline 10 events

  1. Other
    DOJ reportedly weighs joining states’ lawsuit

    Bloomberg reported that senior Justice Department officials have discussed formally joining the states’ suit against BlackRock and State Street, which would escalate federal involvement.

    DOJ Weighs Joining Texas BlackRock, State Street Antitrust Case

  2. Order
    BlackRock and State Street move for judgment on the pleadings

    The remaining defendants filed a joint motion for judgment on the pleadings against the states’ second amended complaint.

    State of Texas/Ken Paxton Aty General v. BlackRock, Inc. docket

  3. Order
    Court dismisses all claims against Vanguard

    Judge Kernodle dismissed all pending claims against Vanguard with prejudice under the settlement, leaving BlackRock and State Street as defendants.

    State of Texas/Ken Paxton Aty General v. BlackRock, Inc. docket

  4. Settlement
    Vanguard settles for $29.5M

    Vanguard agreed to pay $29.5M, expand its investor-choice program and withdraw from climate-target-setting investor coalitions to resolve the states’ claims.

    Vanguard Settles Collusion Suit for $29.5 Million

  5. Filing
    States file second amended complaint

    The attorneys general filed a second amended complaint, which the asset managers subsequently answered.

    Settlement Agreement

  6. Hearing
    Court holds status conference

    A transcript of the conference was later filed on the docket.

    State of Texas/Ken Paxton Aty General v. BlackRock, Inc. docket

  7. Order
    Court denies most of asset managers’ motions to dismiss

    Judge Kernodle allowed the core Sherman Act and Clayton Act conspiracy claims to proceed while dismissing a small number of counts.

    BlackRock, Vanguard, State Street bid to dismiss coal antitrust case fails

  8. Order
    FTC and DOJ file statement of interest backing states

    The Federal Trade Commission and the Department of Justice Antitrust Division filed a joint statement of interest arguing the asset managers misapply antitrust law in their defense.

    FTC and DOJ File Statement of Interest in Energy Collusion Case Against BlackRock, State Street, and Vanguard

  9. Filing
    States file amended complaint

    Thirteen states filed a 110-page amended complaint expanding the antitrust and consumer-protection allegations against the three asset managers.

    Order on Motion to Dismiss

  10. Filing
    Texas leads coalition of states in filing antitrust suit

    Texas and ten other states sued BlackRock, State Street and Vanguard in the U.S. District Court for the Eastern District of Texas, alleging a conspiracy to restrict coal output.

    Attorney General Ken Paxton Sues BlackRock, State Street, and Vanguard

Experimental AI forecast

How it is made

How will the court resolve BlackRock and State Street’s March 16, 2026, motion for judgment on the pleadings by June 30, 2027?

  • Court denies BlackRock-State Street motion38%
  • Still pending on June 30, 202728%
  • Court trims claims, antitrust core survives17%
  • BlackRock and State Street both settle10%
  • Court tosses federal antitrust claims7%
Resolves by
Jun 30, 2027in 9 months
Record confidence
Medium

The most likely result is that the court denies BlackRock and State Street’s motion for judgment on the pleadings by June 30, 2027 (38%). A partial grant that keeps the antitrust core is next most likely (17%). The strongest reason is that the same court already let the core Sherman Act and Clayton Act conspiracy claims proceed in August 2025.

How it resolves. Resolves on the first of these events shown on the public docket by June 30, 2027. (1) The court rules on the joint motion for judgment on the pleadings. A denial in full is “denied.” A partial grant that leaves at least one Sherman Act or Clayton Act claim pending against either defendant is “partial.” A grant dismissing all federal antitrust claims against both defendants is “granted.” (2) Before any ruling, all claims against both BlackRock and State Street are dismissed under settlements. If neither event occurs by June 30, 2027, the question resolves as still pending. A withdrawal or mooting of the motion without a ruling or full settlement counts as still pending.

Reasoning

Starting point. Federal Rule 12(c) motions filed after a court has largely denied a Rule 12(b)(6) motion on the same core claims: Roughly 10% to 20% of post-answer Rule 12(c) motions that re-argue claims already sustained at dismissal end in full dismissal. Most are denied or yield only partial relief.

Rule 12(c) motions that revisit claims already sustained under Rule 12(b)(6) rarely win outright, roughly 10% to 20% of the time. On August 1, 2025, this court allowed the core conspiracy claims to proceed and dismissed only a few counts, so a full reversal would be unusual. The second amended complaint may add new pleading targets, so a partial trimming of state-law or ancillary counts is a real possibility. The motion has been pending about six months with no hearing on the record, and the reported DOJ interest in joining could slow a ruling, so still pending carries substantial weight. Settlement pressure exists because Vanguard exited for $29.5 million and conduct commitments, and federal escalation raises the cost of fighting. But BlackRock and State Street face precedent and business-model risk that makes a quick joint settlement less likely than a ruling. The leading alternative to denial is that the case stays pending past June 30, 2027, because of the DOJ question or other delays.

Court already sustained core antitrust conspiracy claims in August 2025 · Motion pending six months without a hearing on record · Possible DOJ intervention could delay or reshape proceedings · Vanguard settlement sets a template and raises settlement pressure · Precedent risk on common ownership discourages remaining defendants settling

Generated automatically by Claude Opus 5.5 on Sep 26, 2026 from this case’s record on this site, and published without editorial review. The probabilities are the model’s judgment, not measured frequencies, and they are scored publicly as cases resolve. Not legal or investment advice. How the forecasts are made

What it would mean

If the court denies the motion (38%), no money moves soon. BlackRock and State Street would stay in discovery, which runs through 2027, toward a trial reportedly set for January 2028. The states have not quantified damages, so Vanguard’s $29.5M settlement is the only priced benchmark. The larger stake is conduct: Vanguard-style limits would govern BlackRock’s $19B advisory fee base and State Street’s $2.6B investment management fees. A partial grant that keeps the antitrust core (17%) would leave this picture largely intact.

A settlement by both firms (10%) would carry the widest business consequences, mostly in conduct rather than cash. At Vanguard’s price, each would pay about $30M. BlackRock’s management says it does not expect aggregate litigation liability to be material. Commitments on proxy voting and climate coalitions would reach BlackRock’s $15T and State Street’s $5.7T in assets under management. If the court instead tosses the federal antitrust claims (7%), the states’ leverage would fall, and the state-law claims and any DOJ entry would decide what remains.

Money, who pays, markets and what to watch

Two steps ahead. If State Street settles first, as Vanguard did, BlackRock would stand alone against the conspiracy claims and the four-state consumer claims that name only it. Federal antitrust law gives co-defendants no right to contribution, so the last defendant carries any damages exposure. That dynamic, plus possible DOJ entry, would tend to price any deal in conduct commitments, with Vanguard’s roughly $30M as the cash anchor.

The money

  • BlackRock: $29.5M. Settlement benchmark: parity with Vanguard’s $29.5M payment to the suing states in February 2026. The states have not quantified damages, so no litigated damages figure can be sized. A trial verdict could differ in either direction. On execution of any settlement. If litigated, only after a trial reportedly set for January 2028 and a Fifth Circuit appeal.[1][2][3] That is 0.02% of its market value ($172B, Sep 17, 2026), and 0.1% of its annual revenue ($24.2B, 2025).
  • State Street: $29.5M. Settlement benchmark: parity with Vanguard’s $29.5M payment to the suing states in February 2026. The states have not quantified damages, so no litigated damages figure can be sized. On execution of any settlement. If litigated, only after a trial reportedly set for January 2028 and a Fifth Circuit appeal.[1][2][3] That is 0.06% of its market value ($52.7B, Aug 18, 2026), and 0.2% of its annual revenue ($13.9B, 2025), and 0.1% of its equity or regulatory capital ($27.8B, Dec 31, 2025).
  • BlackRock: $19.2B a year of revenue at stake. 2025 investment advisory, administration fees and securities lending revenue. This is the business line whose stewardship, proxy voting, and coalition membership a Vanguard-style conduct remedy would govern. It is not revenue a remedy would remove. Annual, for as long as any conduct commitment or injunction runs.[4][5] That is 79% of its annual revenue ($24.2B, 2025).
  • State Street: $2.6B a year of revenue at stake. 2025 Investment Management segment fee revenue. This is the business line whose stewardship and proxy voting a Vanguard-style conduct remedy would govern. It is not revenue a remedy would remove. Annual, for as long as any conduct commitment or injunction runs.[6][5] That is 19% of its annual revenue ($13.9B, 2025).
  • Figures used: BlackRock, market value $172B (Sep 17, 2026)[7] · BlackRock, annual revenue $24.2B (2025)[8] · State Street, market value $52.7B (Aug 18, 2026)[9] · State Street, annual revenue $13.9B (2025)[10] · State Street, equity or regulatory capital $27.8B (Dec 31, 2025)[11]

Who pays

  • BlackRock, Inc. and State Street Corporation, the parent companies, are the named defendants and would pay directly. No insurance coverage, indemnity, or case-specific reserve has been disclosed.[12]
  • BlackRock carries extra exposure. The court kept consumer-protection claims against BlackRock alone under the laws of Texas, Montana, Iowa, and Nebraska.[13]
  • Vanguard is out. It paid $29.5M to the suing states without admitting wrongdoing, and the court dismissed all claims against it with prejudice on February 26, 2026.[2]
  • Any settlement cash would go to the plaintiff states rather than directly to electricity consumers, as in the Vanguard deal.[2][14]

Markets

  • BlackRock (NYSE: BLK) and State Street (NYSE: STT) common shares are the listed securities most directly tied to the case. BlackRock also lists 3.750% Notes due 2035 on the NYSE.[4][15]
  • No closing share-price move has been reported for either firm after the August 1, 2025, dismissal ruling, the Vanguard settlement, or the September 18, 2026, DOJ report.[15]
  • BlackRock’s FY2025 annual report says management does not anticipate that aggregate litigation liability will materially affect its results, financial position, or cash flows.[12]
  • BlackRock’s market value was about $172B on September 17, 2026, and State Street’s about $53B on August 18, 2026.[7][9]

Collecting

  • Collection is not the constraint. Both defendants are large U.S. companies with domestic assets, so any judgment would be enforced in U.S. courts.[7][9][11]
  • A litigated money judgment would not be paid until after trial and appeal to the Fifth Circuit. Trial is reportedly set for January 2028, and discovery runs through 2027.[3][16]
  • Settlement is the fast path to cash. Vanguard settled on February 25, 2026, and the court dismissed its claims the next day.[17]

Beyond the parties

  • The case tests common-ownership antitrust theory. DOJ and the FTC called their May 2025 filing their first formal statement in federal court on common shareholdings.[18]
  • Vanguard’s terms are the template: proxy voting for funds holding at least 50% of its U.S. equity fund assets, and exit from climate-target-setting groups.[5][2]
  • A settlement on similar terms would reach BlackRock’s $15.3T in assets under management at June 30, 2026, and State Street’s $5.67T at December 31, 2025.[19][11]
  • The court found plausible allegations built on climate-initiative membership, parallel commitments, engagement with coal managements, and aligned proxy voting. Asset managers across the industry are reviewing engagement practices on that basis.[20]
  • The states allege covered coal producers cut output about 18% to 19% while prices rose about 21% to 25%. Those allegations would anchor any consumer-harm damages claim.[13]

What to watch

  • Late 2026DOJ decides whether to join the states’ suit as a party. Officials have discussed it with the states and the companies, and no decision has been made.[21][15]
  • PendingCourt rules on BlackRock and State Street’s March 16, 2026, motion for judgment on the pleadings. The states have filed their response.[22]
  • Through 2027Discovery continues. Document and deposition fights will show how much engagement evidence the states obtain.[16]
  • January 2028Trial reportedly set in the Eastern District of Texas.[3]

Sources

  1. In Texas, Vanguard settles antitrust suit for $29.5 million and renewed passivity pledges investing.com · 2026-02-26
  2. Vanguard settles coal antitrust suit with Republican states for $29.5M esgdive.com · 2026-03-02
  3. DOJ Considers Joining Antitrust Case Against BlackRock briefs.co · 2026-09
  4. BlackRock, Inc. Form 10-K FY2025 sec.gov
  5. Attorney General Paxton Secures Historic, Industry-Changing Agreement with Vanguard to Protect Coal Industry texasattorneygeneral.gov
  6. State Street Corp Form 10-K FY2025 sec.gov
  7. BlackRock (BLK) Market Cap & Net Worth stockanalysis.com · 2026-09-17
  8. BlackRock Revenue stockanalysis.com
  9. State Street 2026 Company Profile pitchbook.com · 2026-08-18
  10. State Street (STT) Revenue 2005-2025 stockanalysis.com
  11. State Street Corp Form DEF 14A 2026 sec.gov
  12. BlackRock, Inc. Form ARS FY2025 sec.gov
  13. Memorandum Opinion and Order on Motions to Dismiss, Texas v. BlackRock, No. 6:24-cv-00437-JDK texasattorneygeneral.gov · 2025-08-01
  14. Vanguard’s antitrust coal settlement and what it signals for ESG litigation esgdive.com · 2026-03-06
  15. DOJ considers joining Texas BlackRock, State Street antitrust case - report msn.com · 2026-09-18
  16. Climate Skeptics Rush to Misuse Texas v. BlackRock blogs.law.columbia.edu · 2025-12-11
  17. Vanguard Settles Texas Coal Antitrust Suit: Potential Seismic Shift or Standard Practice Reaffirmed? ropesgray.com · 2026-03-05
  18. Justice Department and Federal Trade Commission File Statement of Interest on Anticompetitive Uses of Common Shareholdings justice.gov · 2025-05-22
  19. BlackRock, Inc. Form 10-Q for the quarter ended June 30, 2026 sec.gov
  20. Shareholder Engagement Considerations in Light of Texas v. BlackRock corpgov.law.harvard.edu · 2025-08-18
  21. DOJ Weighs Joining Texas BlackRock, State Street Antitrust Case bloomberg.com · 2026-09-18
  22. Texas v. BlackRock, Inc. climatecasechart.com · 2026-04-13

Experimental AI analysis by Claude Opus 5.5 on Sep 26, 2026, built on the forecast above from this case’s record and public sources found by the model’s own web search. Figures are estimates as of the dates shown, and shares of value are computed by the site from the figures cited. Published without editorial review. Nothing here predicts the price of any security or is investment advice. How it is made