Plaintiffs in FX benchmark rate fixing case clarify motion for class certification

Maria Nikolova

This private antitrust case targets banks like JPMorgan, HSBC, Citi, Barclays and UBS that agreed “to eliminate competition in the purchase and sale of the EUR/USD currency pairs in the United States and elsewhere”.

While the disagreements around depositions in a Forex benchmark rate fixing case targeting major banks continue, the plaintiffs in the case have provided details on their proposed motion for class certification.

The lawsuit is a private antitrust case brought under Sections 4 and 16 of the Clayton Antitrust Act, 15 U.S.C. §§ 15, 26, alleging violation of Section of the 1 Sherman Antitrust Act, 15 U.S.C. § 1, in that it is alleged that the defendants, including banks like JPMorgan, HSBC, Citi, Barclays and UBS, agreed “to eliminate competition in the purchase and sale of the EUR/USD currency pairs in the United States and elsewhere”.

Each of the defendant banks confessed that they “eliminated competition in the purchase and sale of the EUR/USD currency pairs” and that their violations were in disregard of the law.

In a Letter, filed with the New York Southern District Court on February 7, 2020, the plaintiffs say that they are the representatives of the following designated class:

“All consumers and businesses in the United States who directly purchased supracompetitive foreign currency at Benchmark exchange rates from Defendants and their co-conspirators for their own end use at least since January 1, 2007 to [December 31, 2013]”.

The plaintiffs argue that their claims for class certification are compliant with the requirements.

For instance, Rule 23(a)(1) requires that “the class is so numerous that joinder of all members is impractical.” Transactional data produced in this action, the plaintiffs say, demonstrates that there are thousands of end-user class members, who purchased foreign currency “for their own end use”, so the numerosity criterion is satisfied.

The plaintiffs also note that their class definition corresponds with commonality requirements. Rule 23(a)(2) requires that “there are questions of law or fact common to the class.” According to the plaintiffs, the alleged violation of antitrust law is a common issue capable of class-wide resolution. Plaintiffs’ expert will present generalized class-wide proof that the defendant banks’ conspiracy to fix and manipulate benchmark exchange rates resulted in the plaintiffs and the class paying higher prices for foreign exchange than they would have paid but for the defendants’ conspiracy to fix and manipulate benchmark exchange rates. Plaintiffs’ expert will provide an analysis of causation by preparing a regression analysis that shows a statistically significant correlation between the spot fix rate and the end user rate.

Regarding typicality, the plaintiffs argue that each class member’s claims and injuries arise from a common overarching conspiracy to fix and manipulate FX benchmark exchange rates that resulted in a common antitrust injury that “the manipulated FX benchmark rates were the primary component of the prices Plaintiffs and the class paid for foreign currency in the consumer retail market.”

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