Texas Attorney General Ken Paxton filed a lawsuit against proxy advisory firm Institutional Shareholder Services, Inc. (ISS) alleging violations of the Texas Deceptive Trade Practices Act by prioritizing political agendas over sound financial guidance in voting recommendations. The lawsuit seeks an injunction to stop deceptive practices and civil penalties of up to $10,000 per DTPA violation. This action follows a 2025 investigation into ISS and peer firm Glass Lewis & Co.
The lawsuit seeks an injunction prohibiting ISS from engaging in deceptive and illegal acts under the DTPA, civil penalties of up to $10,000 per violation of the DTPA, and additional unspecified relief.
In-house legal teams at public companies and institutional investors that engage proxy advisory firms should review their vendor agreements with such firms to ensure they include requirements for objective, financial-principle-based voting recommendations that prioritize fiduciary duty over ideological agendas. Clauses should mandate disclosures of potential conflicts of interest, prohibit the imposition of political or social quotas unrelated to financial performance, include representations of neutrality and compliance with the Texas Deceptive Trade Practices Act, and outline remedies for misleading or deceptive guidance. Teams should also review termination clauses for breaches of fiduciary duty or deceptive practices.
Entity
Institutional Shareholder Services, Inc.
Industry
Financial ServicesOfficial Press Release
https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-sues-worlds-largest-proxy-advisory-firm-pushing-radical-political-agenda
ISS Petition
https://www.texasattorneygeneral.gov/sites/default/files/images/press/ISS%20Petition.pdf
Texas Attorney General Enforcement Page
https://www.texasattorneygeneral.gov/consumer-protection/privacy
"Institutional Shareholder Services, Inc. (“ISS”)"
"Texas Deceptive Trade Practices Act (“DTPA”)"
"misleading institutional investors and public companies by issuing voting recommendations that prioritize radical political agendas over sound financial principles and fiduciary duty"
"seeks to stop ISS from continuing its deceptive and illegal acts, civil penalties of up to $10,000 for each violation of the DTPA, among other relief"
"/sites/default/files/images/press/ISS%20Petition.pdf"
"May 20, 2026"
$7.5M
Texas Attorney General Ken Paxton announced a $7.5 million settlement with Tris Pharmaceuticals over alleged misrepresentations about the efficacy of Dyanavel XR, an ADHD drug marketed for children. The release says the company overstated the drug’s efficacy and directed sales representatives to make misleading claims to doctors, including Medicaid providers.
Texas Attorney General Ken Paxton announced an agreement with Plum Organics requiring stronger testing and limits for heavy metals in covered baby food products, along with publicly accessible testing results. The release does not state a monetary penalty; the agreement follows an ongoing investigation into baby food manufacturers.
Texas Attorney General Ken Paxton opened an investigation into Blue Cross and Blue Shield of Texas, its parent Health Care Service Corporation, and related entities over alleged denials or delays of urgent and medically necessary care and potentially burdensome prior authorization requirements. The investigation is ongoing; the Attorney General issued a Civil Investigative Demand to obtain information and assess potential violations of Texas law.
Texas Attorney General Ken Paxton issued a consumer alert warning Texas businesses and nonprofits about a surge of demand letters alleging California Invasion of Privacy Act (CIPA) violations based on common website technologies such as cookies, pixels, and analytics tools. The AG cautions that some letters may exaggerate or misrepresent violations and may be fraudulent, noting serial CIPA plaintiff Vivek Shah has been declared a vexatious litigant. Recipients are advised not to pay or respond directly, to consult privacy counsel, and to report suspected fraud to the Consumer Protection Division.
A Texas state district court (Judge Cory Liu) has found TikTok liable for lying to parents about the safety of its platform and for exposing children to inappropriate and explicit content, making Texas the first state in the nation to hold TikTok liable on these claims. The court found that although TikTok claimed it would remove graphic videos depicting drugs, nudity, alcohol, injuries, and profanity, such videos remained accessible to minors, even under 'Restricted Mode.' No penalty has been imposed yet; Attorney General Paxton will proceed to trial, expected next month, where relief and penalties will be determined.
Texas Attorney General Ken Paxton opened an investigation into TriWest Healthcare Alliance Corp., the U.S. government contractor that administers the VA Community Care Network and the Defense Health Agency's TRICARE West Region, over reports that it wrongfully denied health care claims by falsely treating insureds as having other health insurance (OHI). The OAG has issued Civil Investigative Demands (CIDs) and plans to interview consumers and employees to determine whether TriWest violated the Texas Deceptive Trade Practices Act. No findings or penalties have been imposed yet.