ESG Initiatives Under Fire: DOJ and FTC Back Antitrust Challenge to Coal Investment Strategy

The Hogan Lovells firm reports that the Federal Trade Commission (FTC) and the Department of Justice (DOJ) Antitrust Division have filed a Statement of Interest (SOI) in support of a lawsuit by Republican state attorneys general, accusing three major investment firms of anticompetitive collusion in the coal sector. The firms are alleged to have leveraged their influence as shareholders to coordinate output reductions at competing coal companies, all under the banner of achieving environmental “net zero” goals. This case highlights the growing scrutiny of ESG initiatives (environmental, social, and governance), particularly when such efforts involve collaboration among competitors that may impact market competition or consumer pricing. According to the plaintiffs, this coordination resulted in reduced supply, inflated energy prices, and cartel-level profits, constituting violations of both federal and state antitrust laws.

The FTC and DOJ’s endorsement of the case underscores a significant policy signal: ESG initiatives, even if publicly framed as climate-conscious or socially responsible, are not exempt from antitrust scrutiny. The agencies argue that efforts to reduce coal output amount to classic horizontal collusion, irrespective of environmental motivations. Supporting this position, the agencies invoked recent executive actions from President Trump aimed at boosting domestic energy production, particularly coal, as a matter of national security and economic strategy.

Statements from FTC Chair Ferguson and DOJ Assistant Attorney General Slater made clear that this enforcement action is part of a broader agenda to push back against ESG-aligned financial strategies perceived to interfere with traditional energy markets. The agencies’ message is unequivocal: ESG goals cannot shield companies from antitrust liability.

For litigation professionals, this case marks a pivotal development in U.S. antitrust enforcement. It signals heightened risk for collaborative ESG strategies and raises the stakes for multijurisdictional compliance. As the DOJ and FTC align with state AGs in challenging climate-related agreements, companies must tread carefully, especially when coordinating with competitors in ways that might affect output or pricing.