Watch the press conference with Houston Controller Collins, State Senator Johnson, and State Rep. Bhojani here

Read details on lawsuit challenging SB-13’s constitutionally here

Washington, D.C. – Earlier today, Democracy Forward President and CEO Skye Perryman hosted Houston Controller Chris Hollins, State Senator Nathan Johnson (SD-16), and State Representative Salman Bhojani (HD-92) for a press call to discuss the new lawsuit against Texas’ extreme anti-business law. The law, SB-13, penalizes private companies that choose not to make risky investments in fossil fuel companies on the basis of the companies’ actual or perceived political views regarding fossil fuels.

Last month, the American Sustainable Business Council (ASBC), acting on behalf of members including Etho Capital and Sphere, challenged the constitutionality of SB-13 for violating the free speech and association rights protected under the First and Fourteenth Amendments. The lawsuit filed in the Western District of Texas’ Austin Division contends that SB-13 discriminates against companies that speak out against fossil fuels, including those that use environmental, social, and governance (“ESG”) metrics in their investing and business practices. The businesses are being represented by Democracy Forward, Emery Celli Abady Brinckerhoff Ward & Maazel LLP, and Guerrero & Whittle PLLC.

Here’s what Democracy Forward and Texas officials had to say about the lawsuit, the harms of SB-13, and what can be done to protect Texans from anti-business extremism:

“We know that SB 13 is an extreme anti-business measure that unjustly penalizes companies that choose not to make risky investments. We believe, and have alleged in our lawsuit, that the law also infringes upon fundamental rights protected by the U.S. Constitution, including in the First and 14th Amendments. And we know that Texans believe that investors should be able to consider a company’s environmental and social practices when determining whether to invest,” said Skye Perryman, president and CEO of Democracy Forward. “We’re confident that the federal courts will strike the law down as unlawful as just a blatant violation of constitutional freedoms in the country.”

“The recent economic reports about SB 13’s impact should serve as a wake-up call for all of us. We’re losing hundreds of millions of dollars due to higher fees and getting less competitive services as a result, and thousands of jobs have already been lost. While extremist politicians get a talking point for cable news or social media, it’s on our city as an issuer, our retirees, and our local officials to deal with the fallout. And what’s even more frustrating — Texans don’t want these blacklist bills,” said Chris Hollins, Controller, City of Houston. “People in Houston and across the great state of Texas want sensible policies that protect their investments and that protect their futures — they don’t want their financial well-being jeopardized by these political games. If this pattern continues, we will tarnish our reputation as a state that’s open for business and destroy what we now know as the ‘Texas Miracle.’”

“The hypocrisy of [SB-13] is galling, but it’s also damaging. […] You cannot be for the free flow of capital only when you like where it’s flowing; you cannot be for freedom of speech only when you like what they’re saying, and you cannot claim to have respect for business judgment only when you like their decisions,” said Nathan Johnson, State Senator, District 16. “It harms us internationally, it harms us from the local level to the state level, and it takes our government in a direction that I really think is not going to serve anybody very well.”

“SB 13 limits access to financial services and investment options for state and local governments. This means that less funding is available for certain infrastructure projects, community development and support for small businesses, all of which are key drivers for local economic growth. Without sufficient investment, businesses struggle to expand, to hire and to innovate. Texas should be encouraging businesses to consider all factors that affect long term success, including metrics that relate to the environment. These considerations promote innovation, sustainability and economic growth,” said Salman Bhojani, State Representative, District 92. “My vision for Texas is one where we embrace innovation and sustainability, turning challenges into opportunities for growth by allowing businesses to make decisions that are both financially sound and socially responsible.”

The lawsuit highlights the substantial financial harm SB-13 has had on Texas taxpayers. Plaintiffs argue that SB-13 prohibits state investments and contracts with companies that advocate for reductions in reliance on fossil fuels while also negatively impacting businesses that use ESG metrics and on everyday Texans. 

To request an interview with a Democracy Forward spokesperson or one of the parties to the suit, please email dgrahamcaso@democracyforward.org.

– # # # –