The U.K. Court of Appeal dismissed an appeal by two pension plan participants against directors of the £90.8 billion ($118.9 billion) Universities Superannuation Scheme, London, that alleged they breached their director duties by investing in fossil fuels.
The lawsuit said USS announced in May 2021 that it was seeking to have carbon-neutral portfolios by 2050, but its directors failed to create a plan to deal with the financial risks involved in such investments.
The "continued investment in fossil fuels without any or any adequate plan for divestment was a breach of the director's duty," the lawsuit said.
The participants were appealing the judgment of the High Court, which dismissed their case in May 2022.
Justices agreed that no evidence supported the allegation that directors furthered their own interests or put their own beliefs about fossil fuels above the interests of USS' participants.
Responding to the court's decision, a USS spokesman said in an email: "It will be clear to anyone reading the Court of Appeal's detailed judgment that the underlying claims these individuals sought permission to pursue had absolutely no merit and they have rightly been dismissed."
"It is of deep regret that scheme funds — money intended to pay members' pensions — have had to be spent defending this action, particularly when much of the material considered by the courts in dismissing this case was readily and publicly available," the spokesman added.