.jpg)
2 hours ago
3
Article content
(Bloomberg) — The US Supreme Court refused to block a class action lawsuit that seeks billions of dollars from Bank of America Corp., JPMorgan Chase & Co. and other financial institutions for allegedly fixing prices in the municipal bond market.
THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
SUBSCRIBE TO UNLOCK MORE ARTICLES
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
REGISTER / SIGN IN TO UNLOCK MORE ARTICLES
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account.
- Share your thoughts and join the conversation in the comments.
- Enjoy additional articles per month.
- Get email updates from your favourite authors.
THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account
- Share your thoughts and join the conversation in the comments
- Enjoy additional articles per month
- Get email updates from your favourite authors
Sign In or Create an Account
or
Article content
Making no comment, the high court on Monday turned away an appeal from units of eight banks, refusing to hear their arguments that a federal trial judge was wrong to certify the case as a class action. Municipalities led by the city of Philadelphia are pressing the suit, accusing the banks of inflating interest rates on state and municipal bonds.
Article content
Article content
Article content
The case ultimately could settle for about $770 million, with Bank of America and JPMorgan having the biggest potential exposure, according to Bloomberg Intelligence senior litigation analysts Elliott Z. Stein and Jennifer Rie.
Article content
By signing up you consent to receive the above newsletter from Postmedia Network Inc.
Article content
The municipalities are also suing units of Citigroup Inc., Morgan Stanley, Goldman Sachs Group Inc., Barclays Plc, Royal Bank of Canada and Wells Fargo & Co.
Article content
The dispute centers on the banks’ work as remarketing agents for variable-rate demand bonds, known as VRDOs. In that role, the banks were supposed to regularly reset the interest rates at the lowest possible level that will allow the bonds to trade at face value.
Article content
The municipalities accuse the banks of conspiring to set rates above competitive levels to increase their chances of placing the VRBOs with an investor rather than having to keep them in their own inventory. The antitrust lawsuit seeks a total of $12 billion damages.
Article content
In their Supreme Court appeal, the banks said the municipalities hadn’t met one of the class action requirements by showing that issues common to all the plaintiffs would predominate over individual questions. The banks were seeking to overturn a federal appeals court decision that let the class action go forward.
Article content
The banks are separately defending against related claims in state court in New York and California under the US False Claims Act. Those cases could settle for $400 million, according to Stein and Rie.
Article content
The case is Banc of America Securities v. City of Philadelphia, 25-639.
Article content
English (US)