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Update:
- An English appeals court overturned the decision of a lower court and revived a £2.7 billion ($3.5 billion) class action lawsuit alleging five major banks, including JPMorgan and Barclays, engaged in cartel-like behaviour to rig the foreign exchange market in their favour.
- The claims were first brought against the banks in 2019. However, in March 2022, the Competition Appeal Tribunal ruled the proposed cases were so weak they were “deserving of strike-out,” allowing them to proceed on an opt-in basis only.
- On July 25, the Court of Appeal overturned that decision, saying the lower court “erred” and the case should in fact proceed on an opt-out basis.
- The decision means claims on behalf of tens of thousands of class members can now move forward against Barclays, Citi, JPMorgan, UBS, NatWest and MUFG Bank, a Japanese lender.
- The lawsuit, filed on behalf of pension funds, asset managers and corporations, claimed the banks unlawfully manipulated the market between 2007 and 2013.
(Sept. 12, 2021)
In 2019, several banks were accused of manipulating foreign exchange markets in a pair of class action lawsuits and, on Monday, the two law firms who filed the litigation fought for control of the £1 billion claim.
The UK Competition Appeal Tribunal heard arguments from Hausfeld LLP and Scott + Scott UK LLP, with each firm arguing it should take the lead – if the Forex class action lawsuits are consolidated. Indeed, the tribunal must also determine whether the competing lawsuits should be turned into a collective action, the UK equivalent to an American-style class action lawsuit.
In 2019, investors initiated the litigation, claiming that five major banks, including JPMorgan and Barclays, engaged in cartel-like behaviour to rig the foreign exchange market in their favour.
The legal action, filed on behalf of pension funds, and asset managers and corporations, claimed that the banks unlawfully manipulated the market between 2007 and 2013. The class action came on the heels of a decision by the European Commission to fine Mitsubishi UFJ Financial, along with five lenders, more than €1 billion for violating EU competition laws.
In Monday’s hearing, each firm claimed that had the best case to move forward with the market manipulation claims.
“I believe our claim is more comprehensive; we have more financing to cover the legal action and more financing remaining; we have more [insurance] cover; and we have a plan for the distribution of damages using the U.S. experience,” Michael O’Higgins, former chairman of Britain’s pensions regulator, and lead plaintiff in one of the competing claims argued during the hearing, according to Law360.
O’Higgins and the law firm Scott + Scott filed legal action in July 2019. They want to represent tens of thousands of investors who they say suffered losses due to foreign market exchange manipulation by Barclays, Citibank, the Royal Bank of Scotland, JPMorgan Chase and UBS.
Phil Evans, a former Competition and Markets Authority inquiry chair filed the competing action in December 2019.
The banks are reportedly waiting for a chance on Friday to argue that a collective opt-out action is an inappropriate proceeding for the claims.
What do you think of the claims that banks manipulated the foreign exchange market? Tell us in the comment section below!
Plaintiff O’Higgins is represented by Daniel Jowell QC and Gerard Rothschild of Brick Court Chambers, instructed by Scott + Scott UK LLP.
Plaintiff Evans is represented by Aidan Robertson QC of Brick Court Chambers, instructed by Hausfeld LLP.
The Foreign Exchange Antitrust Class Action Lawsuit is Michael O’Higgins FX Class Representative Ltd. v. Barclays Bank PLC and others, Case No. 1329/7/7/19, and Phillip Evans v. Barclays Bank PLC and others, Case No. 1336/7/7/19 in the Competition Appeal Tribunal.
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