"It must be enjoined," said the complaint in Wong et al. vs. New York City Employees' Retirement System et al.
The city pension system consists of five pension funds each with separate, independent boards. Three of the pension funds are defendants because they have divested fossil fuel holdings: New York City Employees' Retirement System; Teachers' Retirement System of the City of New York; and Board of Education Retirement System of the City of New York.
They account for 73% of the $243.2 billion in total pension system assets.
Pension funds representing police and fire departments declined to divest fossil fuel holdings.
"While we don't comment on pending litigation, we take our fiduciary duty very seriously," a spokeswoman for city Comptroller Brad Lander wrote in an email. Mr. Lander is the fiduciary for the five pension funds.
"The trustees of all three funds voted in 2021 to exclude fossil fuel reserve owners from their portfolios, in accordance with their fiduciary duty following a deliberative process that began in 2018, with the goal of protecting beneficiaries from the financial risks of investing in fossil fuel reserves," the spokeswoman added.
The plaintiffs are a subway train operator, a former city public school teacher now a part-time teacher in a parochial school, an occupational therapist in a city elementary school and a school secretary in the city's Department of Education.
The latter three are members of Americans for Fair Treatment Inc., an organization that advocates "all public sector employees should have the freedom to choose to join a union or to abstain from joining a government union, an employee association, or other group," according to its website.
The organization, also a plaintiff in the lawsuit against the pension funds, contains information about quitting union membership. "To get started, fill out the form on this page and we will get in touch with you about your best options to leave your union," the website says.
The lawsuit said the three pension funds have divested about $4 billion in fossil fuel holdings, actions initiated in January 2021 during the tenure of former Mayor Bill de Blasio and former Comptroller Scott M. Stringer. Both were term-limited and left office at the end of 2021.
Mr. Lander is "continuing the strategy of using that office to advance an environmental agenda at the expense of retirement security," the lawsuit said.
"In April 2022 Lander announced that the three New York City pension systems had increased their investments in 'climate solutions' to more than $7 billion," the lawsuit said. "For Lander and the trustees, the pension plans are a tool to promote their climate agenda at the expense of plan participants' financial interests."
The lawsuit also attacked the employees and teachers pension funds for their votes earlier in 2023 for adopting a net zero emissions strategy for investments.
Referring to the employees pension fund trustees' vote, the lawsuit said this action "shows just how completely the Trustees have allowed non-pecuniary, climate-related objectives to become the lodestar in their management of plan assets."
The lawsuit accuses the three pension funds of violating New York state common law and insurance regulations. Both require "actuarially funded public retirement systems" to follow "stringent duties of loyalty and care," the document said. "Defendants breached those duties by subordinating the retirement security of plan participants to the trustees' pursuit of a 'green' climate agenda."
