Oklahoma sued over anti-ESG law

investmentnews.com:

An Oklahoma pensioner is challenging a state law that targets financial firms, including BlackRock Inc. and JPMorgan Chase & Co., for their climate change policies.

Don Keenan, a former state employee, is seeking a temporary restraining order against Oklahoma treasurer Todd Russ and the state over the 2022 law enacted by the Republican legislature. As part of the legislation, Russ released a list of six firms that are restricted from doing business with the state.

The lawsuit, filed on Monday in the district court of Oklahoma County, said the legislation is unconstitutional and violates the First Amendment. “The state’s decision to use its retirees’ retirement funds as political fodder in its quixotic quest to prove a point is patently unconstitutional and violates federal law,” Keenan’s lawyer said in the suit.

State governmental entities are exempt from the law if they find that divestment would be inconsistent with their fiduciary responsibility. The Oklahoma Public Employees Retirement System sought to use that carve-out so it wouldn’t have to divest about $6 billion in pension assets managed by BlackRock, the Oklahoman reported. Russ criticized the use of that exemption. OPERS staff estimate that divestment from the restricted companies could cost about $10 million.

The Oklahoma Public Employees Association, which represents 32,000 state employees, is part of a coalition backing the lawsuit. OPEA wants to use the temporary injunction to prevent Russ from challenging the pension’s vote or taking further action to enforce the law, executive director Tony DeSha said in an interview. The ultimate goal would be to get the law declared unconstitutional, he said. 

Other states, including Texas and West Virginia, have