Major Banks Obtain Dismissal of Multiple Counts in Libor Case

On March 29, sixteen national financial institutions scored a major victory in federal court when U.S. District Court Judge Naomi Rice Buchwald dismissed several claims in private lawsuits alleging antitrust violations that resulted in injured investment returns for a number of plaintiffs. In 2011, the City of Baltimore and the New Britain Firefighters’ Benefit Fun filed a complaint against a dozen major U.S. banks, including Bank of America, Citigroup, Credit Suisse, Deutsche Bank, HSBC and JPMorgan Chase. Specifically, the plaintiffs alleged that the banks manipulated the Libor, a key metric that sets interest rates using data computed daily from domestic and international banks. The plaintiffs claimed that by "suppressing" the Libor, the banks concealed their level of risk during the financial crisis. In 2012, the banks filed a Motion to Dismiss, arguing that the evidence does not support the existence of a conspiracy to manipulate rates. In addition to the dismissal of the antitrust claims, Judge Buchwald also partly dismissed the plaintiffs’ claims of commodities manipulation, a claim of racketeering, and state-law claims. Although the plaintiffs’ claim that the banks’ suppression of the Libor resulted in harm to traders who bet on interest rates was not dismissed, Judge Buchwald’s decision may give the banks’ leverage in future settlement talks.

Although it is unclear whether any Florida municipalities are considering similar suits, WSH does have experience handling such matters. After the Lehman Brothers collapse in 2008, WSH's Litigation Division and Local Government Division were called upon to evaluate whether certain of our city clients could sue Lehman for pension losses. Similarly that could happen here in the LIBOR scandal and our Local Government Law Division and Litigation Group are prepared to be on the cutting edge of the issue as it develops.

Categories: LitigationLocal GovernmentFederal LawFederal CourtsClass Actions
Tags: Governmental LitigationMitchell A. BiermanJamie A. ColeChad S. FriedmanEdward G. GuedesMichael S. PopokJoseph H. SerotaRichard Jay WeissDavid M. WolpinFort Lauderdale Business Litigation AttorneysFort Lauderdale Business Litigation LawyersMiami Commercial Litigation AttorneyMiami Commercial Litigation LawyerSouth Florida Commercial Litigation AttorneySouth Florida Commercial Litigation LawyerSouth Florida Business Dispute Litigation AttorneysSouth Florida Business Dispute Litigation LawyersMatthew H. MandelFort Lauderdale LitigatorsMiami LitigatorsSouth Florida LitigatorsFlorida Commercial Litigation LawyerFlorida Litigation AttorneysFort Lauderdale Civil Litigation AttorneysFort Lauderdale Commercial Litigation AttorneysFort Lauderdale Commercial Litigation AttorneysMiami Commercial Litigation AttorneyMiami Litigation Attorney
Author(s): Brooke P. Dolara