Montana AG announces settlement with Vanguard over coal market practices

HELENA – Montana Attorney General Austin Knudsen announced a significant settlement with The Vanguard Group, Inc. regarding anticompetitive practices in the coal market.

In 2024, Knudsen filed a lawsuit against Vanguard, BlackRock and State Street Corporation, accusing them of using their stockholdings to control coal company policies, raising prices of coal and electricity, Knudsen said in a release.

The lawsuit claimed the companies aimed to cut coal output by more than half by 2030 to meet "green energy" goals.

The settlement ensures Vanguard will prioritize client profitability over environmental, social and governance (ESG) goals. The litigation against BlackRock and State Street is ongoing, Knudsen said.

“Vanguard came to the correct conclusion in agreeing to this settlement and honoring its fiduciary responsibility to its clients instead of pushing a woke anti-energy agenda," Knudsen said. "Coal is a huge part of Montana’s economy and our daily lives as we rely on it to power our homes."

As part of the settlement, Vanguard will not direct business strategies, threaten withdrawals or nominate directors for its portfolio companies.

Vanguard will pay $29.5 million to the states, to be held in an escrow account and offer proxy voting to investors in funds accounting for at least 50% of assets in U.S. equity funds it advises. This allows clients to voice their preferences on business strategies, Knudsen added.

Attorneys general from Alabama, Arkansas, Indiana, Iowa, Kansas, Missouri, Nebraska, Texas and Wyoming are also involved in the lawsuit and settlement.