Jpmorgan Muni Bond Rigging Accord Wins Final U.S. Court Approval
JPMorgan Chase & Co. (JPM) won a judge’s final approval of a $44.6 million settlement of a class-action lawsuit alleging that the bank rigged bids for municipal bonds.
U.S. District Judge Victor Marrero in New York issued the order yesterday. The judge had given preliminary approval to the accord in June.
“The settlement was attained following an extensive investigation of the facts,” Marrero wrote in his five-page order. “It resulted from vigorous arm’s-length negotiations which were undertaken in good faith by counsel with significant experience litigating antitrust class actions.”
The case was filed by bond issuers alleging JPMorgan Chase and other banks rigged bids and “restrained, suppressed or eliminated” competition for municipal derivatives, according to court papers.
The accord approved by Marrero yesterday involved only JPMorgan Chase and its Bear Stearns unit. Other banks settled previously.
In his June 4 preliminary-approval order, the judge had certified a class of state, local and municipal government and other entities that had purchased municipal derivatives through negotiation, competitive bidding or auction, from the bank or any alleged provider or broker co-defendant or co-conspirator between January 1992 and August 2011.
Escrow Account
JPMorgan, which has already deposited $24 million into a settlement escrow account, must now add $18.6 million more, according to Marrero’s order. The bank’s agreement to settle didn’t constitute an admission of wrongdoing that can be used in any other civil or criminal proceeding, the judge said.
“Its the beginning of a series of other settlements that we will be announcing over time,” in the municipal derivatives litigation, plaintiffs’ lawyer Michael D. Hausfeld said in a phone interview.
He called yesterday’s approved accord satisfactory in the context of earlier settlements between the defendant banks and states’ attorneys general. Hausfeld is the principal of the Washington law firm Hausfeld LLP.
Jennifer Zuccarelli, a spokeswoman for the New York-based bank, declined to comment on the court order.
The case is In Re Municipal Derivatives Antitrust Litigation, 08-cv-2516, U.S. District Court, Southern District of New York (Manhattan).
Bloomberg
