Source: Law360 | Author: William Gorta
A New York federal judge on Tuesday gave preliminary approval to proposed settlements totaling $111.2 million between five banks and investors in a suit accusing 16 of the world’s largest banks of rigging foreign exchange rates, with the plaintiffs’ counsel also announcing a settlement with another, bringing the running total of banks that have settled to 15.
U.S. District Judge Lorna A. Schofield said she intended to approve all the motions before her in the settlements reached in July with Bank of Tokyo-Mitsubishi UFJ Ltd., Morgan Stanley, RBC Capital Markets LLC, Societe Generale and Standard Chartered PLC, and then asked plaintiffs’ counsel to update her on the status of litigation with the two remaining defendants, Credit Suisse and Deutsche Bank.
Christopher M. Burke of Scott+Scott Attorneys at Law LLP told the judge that the parties were proceeding in the normal course of discovery and then, without specifying which, said the plaintiffs had “reached terms” with another bank.
“We hope to get a motion for preliminary approval … and keep on the same schedule as everybody else,” Burke said.
After the hearing, Burke declined to identify the bank that settled.
The $111.2 million settlement is dwarfed by the $2 billion deal reached with Bank of America Corp., Barclays PLC, BNP Paribas SA, Citigroup Inc., HSBC Holdings PLC, Goldman Sachs Group Inc., JPMorgan Chase & Co., Royal Bank of Scotland PLC and UBS AG, which Judge Schofield preliminarily approved in December 2015.
Under the terms of the settlement approved Tuesday, Morgan Stanley will pay $50 million, Societe Generale will pay $18 million, Standard Chartered will pay $17.2 million, RBC will pay $15.5 million and BTMY will pay $10.5 million, according to settlement documents.
Judge Schofield noted that the five newer settlements came in at $17 million per each bank’s percentage point of the global forex market share, while the earlier deals rang in at $35 million to $50 million per point of global market share.
“What makes that fair?” she asked.
Burke said besides the smaller market share there were several other factors as well as a reduced class period.
“The evidence is not as strong, they were not the ringleaders, none were indicted or pled guilty and no traders had been fired for bad conduct,” Burke said.
The action, which was first filed in 2013 amid regulatory probes, accused major financial institutions of engaging in a scheme to rig the $6 trillion foreign exchange market from at least 2007 to 2013.
The remaining defendants include Credit Suisse AG, along with its affiliates Credit Suisse Group AG and Credit Suisse Securities USA LLC, and Deutsche Bank AG and Deutsche Bank Securities Inc.
Attorneys for the banks and plaintiffs declined to comment after the hearing.
Interim co-lead class counsel is Michael D. Hausfeld, Bonny E. Sweeney, Reena A. Gambhir, Timothy S. Kearns, Nathaniel C. Giddings, and Sarah R. LaFreniere of Hausfeld LLP, and David R. Scott, Joseph P. Gugliemo, Donald A. Broggi, Peter A. Barile III, Sylvia M. Sokol, Thomas K. Boardman, Christopher M. Burke, Walter W. Noss, Kristen M. Anderson, Stephanie A. Hackett and Jennifer J. Scott of Scott & Scott Attorneys at Law LLP.
Bank of Toyko-Mitsubishi UFJ Ltd. is represented by Kenneth A. Gallo and Michael E. Gertzman of Paul Weiss Rifkind Wharton & Garrison LLP.
Morgan Stanley and its affiliates are represented by Jonathan M. Moses and Bradley R. Wilson of Wachtell Lipton Rosen & Katz, and Kevin H. Marino and John Tortorella of Marino Tortorella & Boyle PC.
Societe Generale is represented by James R. Warnot Jr., Adam S. Lurie and Patrick C. Ashby of Linklaters LLP.
RBC Capital Markets LLC is represented by James P. McLoughlin Jr. and Neil T. Bloomfield of Moore & Van Allen PLLC.
Standard Chartered PLC is represented by Andrew W. Stern, Nicholas P. Crowell and Alan M. Unger of Sidley Austin LLP.
The case is In re: Foreign Exchange Benchmark Rates Antitrust Litigation, case number 1:13-cv-07789, in the U.S. District Court for the Southern District of New York.
–Additional reporting by Melissa Daniels. Editing by Jack Karp.
Original Article: https://www.law360.com/articles/960731