368 F. Supp. 3d 681
S.D. Ill.2019Background
- Plaintiff Fire & Police Pension Association of Colorado sued 33 banks (parents, subsidiaries, affiliates) alleging a multi-year conspiracy (Aug 9, 2007–Dec 31, 2014) to suppress the Canadian Dollar Offered Rate (CDOR) to benefit CDOR‑based derivatives, bringing claims under the Sherman Act, CEA, and RICO, plus state-law claims.
- CDOR is a Canadian benchmark set from panel submissions collected by Thomson Reuters; 16 defendants served on the CDOR panel and submitted rates from offices in Canada; other defendants allegedly sold CDOR‑based derivatives in the U.S.
- Plaintiff alleged manipulation via identical/near‑identical submissions, statistical comparisons of CDOR to other benchmarks, and reliance on an IIROC review; plaintiff claimed injury from trading CDOR‑based derivatives in the U.S.
- Foreign defendants (many Canadian/UK/German entities) moved to dismiss for lack of personal jurisdiction; all defendants moved under Rule 12(b)(6) and 12(b)(1). The court granted the motions and dismissed federal claims and declined supplemental jurisdiction over state claims.
- The court found plaintiff failed to plead that defendants had a plausible profit motive (i.e., consistent net‑short CDOR exposure), that CDOR was suppressed during the actionable period, and that RICO predicates/wire‑fraud predicates had sufficient domestic application; it also held many claims time‑barred based on inquiry notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over Foreign Defendants | Foreign banks sold manipulated CDOR‑based derivatives in the U.S., creating suit‑related contacts (purposeful availment/direction/conspiracy) | Submissions setting CDOR occurred from foreign offices; U.S. trading alone does not establish specific jurisdiction; no minimum contacts | Dismissed for lack of personal jurisdiction: plaintiff failed to plausibly allege profit‑motivated scheme tying U.S. trades to foreign submissions; conspiracy theory insufficient |
| Sherman Act antitrust standing/injury | Plaintiff transacted in CDOR‑based instruments post‑2014 and was harmed by suppressed CDOR | Plaintiff's own economic comparisons show CDOR was not depressed in the actionable period; no plausible antitrust injury | Sherman Act claim dismissed for lack of antitrust standing (and time‑barred to extent pre‑Jan‑12‑2014; Bank of America defendants fully time‑barred) |
| RICO (wire/mail fraud predicates & extraterritoriality) | Domestic wires (trade confirmations, trading in U.S., transmissions of published CDOR) provide domestic conduct supporting RICO | Predicates (wire fraud) do not apply extraterritorially; primary wrongful acts (submissions) occurred abroad; domestic acts insufficient | RICO claim dismissed as impermissibly extraterritorial and time‑barred in part; no domestic predicate conduct sufficiently alleged |
| CEA claims and statutes of limitation | CDOR‑based swaps and futures victims in U.S. support CEA claims | IIROC report and publicly available data put plaintiff on inquiry notice well before filing; CEA two‑year limitations bar claims | CEA claims dismissed as time‑barred (plaintiff placed on inquiry notice by Jan 2013) |
Key Cases Cited
- ATSI Commc'ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87 (2d Cir. 2007) (pleading standard on Rule 12(b)(6))
- Walden v. Fiore, 571 U.S. 277 (2014) (specific jurisdiction requires forum connection to the underlying controversy)
- Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011) (distinction between general and specific jurisdiction)
- Licci v. Lebanese Canadian Bank, SAL, 673 F.3d 50 (2d Cir. 2012) (jurisdictional requirements and nationwide service discussion)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards and legal conclusions)
- Charles Schwab Corp. v. Bank of Am. Corp., 883 F.3d 68 (2d Cir. 2018) (limits on jurisdiction from foreign benchmark submission claims)
- Gelboim v. Bank of Am. Corp., 823 F.3d 759 (2d Cir. 2016) (antitrust injury analysis in benchmark manipulation context)
- Morrison v. National Australia Bank Ltd., 561 U.S. 247 (2010) (presumption against extraterritorial application of statutes; relevance to RICO predicates)
- RJR Nabisco, Inc. v. European Community, 136 S. Ct. 2090 (2016) (RICO extraterritoriality and predicate‑act limits)