A federal judge in Amarillo, Texas, rejected arguments made by 26 attorneys general in Republican-led states challenging the legitimacy of the Biden Administration’s so-called ESG rule.
The attorney generals had asked the court to reconsider its earlier decision to affirm the rule after the U.S. Supreme Court overturned the Chevron doctrine.
The Department of Labor rule would allow plan fiduciaries to select sustainable investment options in 401(k)s, relying on environmental, social, and governance factors to act as a “tiebreaker” when all other considerations involving competing investments are equal.
The decision might be moot if the DOL withdraws the rule, which has been expected since President Trump was inaugurated.
