A district judge in Manhattan has allowed significant claims to proceed in a national class action lawsuit against US banks involved in the interest rate swaps market. The suit was brought by investors in certain electronic trading platforms, alleging the banks refused to do business with them in order to maintain their market share and put the startup platforms out of business.
A U.S. judge on Friday said investors may pursue part of their nationwide antitrust lawsuit accusing 12 of the world's biggest banks of conspiring to rig the $275 trillion market for interest rate swaps. U.S. District Judge Paul Engelmayer in Manhattan said 11 of the banks, including Bank of America Corp (BAC.N) and JPMorgan Chase & Co (JPM.N), must defend against claims that from 2013 to 2016 they boycotted three upstart electronic platforms for swaps trading, hoping to destroy them. Investors seeking damages in the proposed class action said banks did this to preserve their 70 percent market share, and boost profit by making trading more costly. Engelmayer also said Javelin Capital Markets LLC and TeraExchange LLC, which created two of the electronic platforms, can pursue some of their own claims against banks. A lawyer for both declined to comment.