The federal district court for the Northern District of Texas again upheld the U.S. Department of Labor’s final rule allowing Employee Retirement Income Security Act of 1974 (ERISA) fiduciaries to consider “collateral benefits” such as environment, social, and governance (ESG) factors “when deciding between competing investment options that each equally served the beneficiaries’ financial interests.” The court initially upheld the rule in September 2023 based on application of Chevron deference. The Fifth Circuit remanded the case in July 2024 for reconsideration after the Supreme Court overruled Chevron in Loper Bright Enterprises v. Raimondo. On remand, the district found that the final rule’s “tiebreaking provision” did not violate ERISA’s text—which requires fiduciaries to act “solely” in the participants’ and beneficiaries’ interest and for the “exclusive purpose” of providing benefits to these parties—because the regulation “never permits fiduciaries to deviate from exclusively achieving financial benefits for the beneficiaries alone.” 

Challenge to the U.S. Department of Labor's amendment of the Investment Duties regulation governing private-sector benefit plans.

Utah v. Micone

<p>This entry was provided by the Sabin Center for Climate Change Law. Please see the terms of use for citation and licensing of third party data.</p>

Texas Federal Court Upheld ERISA Fiduciary Rule Allowing ESG Considerations as Tiebreakers

Filed

United States of America

Texas

The Climate Litigation Database

Find climate change litigation data and indicators for {text}.

{text} litigation

Sabin Center for Climate Change Law provides Climate Litigation Database, a comprehensive database of US and Global climate change caselaw

Quickly and easily search through the complete text of thousands of climate change law and policy documents from every country.

Search the Climate Litigation Database

An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Justice is the ethical and political framework that addresses fairness, including issues of responsibility, rights, and structural inequity.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

A ban is a legal action that prevents the sale or supply of a product or service, or that recalls a product from the market. Examples are bans on SF6, greenwashing, fossil fuel advertisement or single-use plastics.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Social protection systems consist of policies that help people manage social risks in order to prevent poverty and maintain decent incomes and living standards

Coal is a combustible sedimentary rock formed from carbonised plant matter, rich in carbon and hydrocarbons, and occurring in several main types including hard coal and brown coal.

Work that is productive and delivers a fair income, security in the workplace and social protection for all, better prospects for personal development and social integration, freedom for people to express their concerns, organize and participate in the decisions that affect their lives and equality of opportunity.

Activities that involve planning, designing and building infrastructure, residential, and commercial structures.

This sector involves activities to move goods and people, alongside the storage of products.

Activities of government agencies and institutions that provide public services, enforce laws and manage public resources.

Texas Federal Court Upheld ERISA Fiduciary Rule Allowing ESG Considerations as Tiebreakers

Policy instrument

Just transition

Fossil fuel

Economic sector

Finance