BlackRock and American Airlines: Is Larry Fink the New Sam Bankman-Fried?

Texas court ruling against American Airlines dealt a massive blow to Environmental, Social, and Governance (ESG) investing by BlackRock.

A federal case out of Texas decided on Friday, could be the first step in a long and painful march for institutional capital behemoth BlackRock and its Hard Left CEO Larry Fink. It’s not all that unrealistic to say that District Judge Reid O’Connor’s ruling might ultimately wipe out BlackRock — and quite likely spells the end of Environmental, Social, and Governance (ESG) investing pioneered by Fink and imposed on corporate America.
The case doesn’t directly involve BlackRock, though it’s fairly obvious others will. Instead, it’s a lawsuit by thousands of pilots and other employees of American Airlines (AA) against that company for violating its fiduciary responsibilities by allowing BlackRock to manage AA’s pension plans — when BlackRock was operating under ESG principles and trying to change the world rather than maximize value in those plans. As the New York Post reported:
A federal judge in Texas on Friday said American Airlines violated federal law by basing investment decisions for its employee retirement plan on environmental, social, and other non-financial factors.
The ruling by US District Judge Reed O’Connor appeared to be the first of its kind amid growing backlash by conservatives to an uptick in socially-conscious investing.
O’Connor said American had breached its legal duty to make investment decisions based solely on the financial interests of 401(k) plan beneficiaries by allowing BlackRock, its asset manager and a major shareholder, to focus on environmental, social and corporate governance (ESG) factors.
“The evidence made clear that [American’s] incestuous relationship with BlackRock and its own corporate goals disloyally influenced administration of the Plan,” wrote O’Connor, an appointee of Republican former President George W. Bush.
You can see this chasm opening up, can’t you? According to Bloomberg Law:
The 2023 lawsuit, which says the airline wrongly offered 401(k) funds managed by companies that pursue ESG policy goals through proxy voting ...