Ten U.S. and European banks, including JPMorgan Chase, Goldman Sachs, Citi and BNP Paribas, have agreed to pay $46 million to settle an antitrust lawsuit that alleges the lenders colluded to stifle competition in the interest rate swaps market.
Attorneys for the plaintiff investors filed a proposed settlement Thursday in the U.S. District Court for the Southern District of New York, requesting a judge grant preliminary approval for the settling amount, which would boost — to $71 million — the total value of settlements in the case. The attorneys also requested that an escrow agent and settlement administrator be appointed, and that payment of certain administrative fees be authorized.
Bank of America, Morgan Stanley, UBS, Barclays, Deutsche Bank and NatWest are the other defendants.
“If approved, the settlement will deliver substantial cash relief to the proposed Settlement Class and bring to a close more than eight years of protracted litigation,” an attorney for the plaintiffs said. “The settlement represents an excellent recovery for the class given the challenges and uncertainties of further litigation.”
The case, brought by the city of Baltimore and pension funds in Los Angeles, Chicago and Michigan in June 2016, was filed roughly a year after JPMorgan agreed to pay part of a $1.86 billion settlement to resolve claims that a dozen big banks plotted to limit competition in the credit-default swaps market.
The plaintiffs accused banks of attempting to monopolize the swaps trading market since at least 2007, according to Cohen Milstein. They alleged that the banks boycotted three emerging platforms that offered more competitive prices and facilitated direct trades between buy-side investors.
The banks, however, have denied any wrongdoing.
The judge in December rejected the plaintiffs' motion for class certification, citing data from the defendants indicating that some customers conducted transactions with zero or negative spreads because of personalized over-the-counter relationships.
The denial stood as a big blow to the swaps case since individual investors cannot typically bring lawsuits on their own, Bloomberg Intelligence analysts said. The analysts predicted earlier that the banks would have to pay between $170 million and $850 million, based on a $25 million settlement Credit Suisse paid in the case in 2022.
The case is among litigation that has spanned more than a decade, asserting big banks have sought to manipulate various markets, including the credit-default swaps, U.S. Treasuries, currencies and commodities.
