By Jonathan Stempel
NEW YORK, Feb 17 (Reuters) – AT&T was sued on Tuesday by four New York City public pension funds, which accused it of wrongly refusing to let shareholders vote on their proposal to require the telecommunications company to disclose the breakdown of its 133,000-person workforce by race, ethnicity and gender.
In a complaint filed in Manhattan federal court, the funds said AT&T cited a November policy change by the U.S. Securities and Exchange Commission, which lets companies that claim a “reasonable basis” to exclude shareholder proposals.
The funds said SEC regulations provide no excuse for AT&T to block a vote on their proposal at its 2026 annual shareholder meeting, and doing so causes “irreparable” injury. They want to prevent AT&T from soliciting shareholder proxies that exclude their proposal.
According to the complaint, Dallas-based AT&T submits the diversity breakdown annually to the U.S. Equal Employment Opportunity Commission. The funds said AT&T disclosed the breakdown publicly between 2021 and 2023 but stopped without explanation in 2024.
AT&T did not immediately respond to requests for comment. A spokesperson for New York City Comptroller Mark Levine did not immediately respond to a similar request.
The plaintiffs include the New York City Employees’ Retirement System, and funds representing police, teachers and other educational employees.
Hundreds of companies have annually asked the SEC’s Division of Corporation Finance for assurances they will not face enforcement actions if they leave shareholder proposals off ballots. The regulator has historically granted permission about half the time.
SEC Chair Paul Atkins has said many shareholder proposals are invalid under the laws of Delaware, where AT&T and about two-thirds of the other Fortune 500 companies are incorporated.
Many companies have deemphasized diversity, equity, and inclusion since U.S. President Donald Trump announced a crackdown on such efforts, including a threat of civil litigation by the federal government, one day after beginning his second White House term.
(Reporting by Jonathan Stempel in New York; Editing by David Gregorio)
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