US Supreme Court Rebuffs Challenge to Class-Action Status of Bank Collusion Suit
The Supreme Court declined to hear an appeal from banks seeking to block a $12 billion class-action lawsuit alleging interest rate manipulation.Summary
The U.S. Supreme Court has rejected a challenge by Bank of America and seven other major financial institutions to prevent a $12 billion class-action lawsuit from proceeding. The suit, brought by cities including Baltimore, Philadelphia, and San Diego, accuses the banks of artificially inflating interest rates on variable-rate demand obligations – a type of municipal bond – between 2008 and 2016. The banks argued that the cities should sue individually and that the case was overly broad, potentially leading to coerced settlements. They also contended that disputes among experts should be resolved before class certification. However, the cities countered that the banks were attempting to turn class certification into a preliminary trial. The Supreme Court’s decision allows the lawsuit to move forward as a class action, potentially impacting thousands of jurisdictions and raising significant financial liability for the banks involved.
(Source：U.S. News & World Report)