In Re Platinum and Palladium Antitrust Litigation, 20-1458 (L)

Background

Plaintiffs: Larry Hollin and White Oak Fund LP (Exchange Plaintiffs, traders in NYMEX platinum/palladium futures) and KPFF Investment, Inc. (sold physical metal). Defendants: several financial firms and dealers (largely foreign), including BASF Metals, Goldman Sachs, HSBC, ICBC, and the London Platinum & Palladium Fixing Company (LPPFC).
From 2008–2014 the market used a twice-daily London "Fixing" administered by LPPFC (owned/controlled by four founding firms) that produced benchmark spot prices widely used in contracts; NYMEX futures prices closely tracked the Fix.
Plaintiffs allege defendants colluded—sharing nonpublic order information and coordinating sell orders, spoofing and wash trades—to depress the Fix and NYMEX futures prices, benefiting defendants holding short positions and in physical markets.
Procedural history: multiple consolidated complaints; district court dismissed Sherman Act claims for lack of antitrust standing (distinguishing KPFF from Exchange Plaintiffs), dismissed CEA claims as impermissibly extraterritorial, and denied conspiracy personal-jurisdiction for some foreign defendants but later found conspiracy jurisdiction over BASF Metals and ICBC; plaintiffs appealed and defendants cross-appealed jurisdiction rulings.
Second Circuit: reversed dismissal as to Exchange Plaintiffs' antitrust standing, affirmed dismissal as to KPFF, vacated dismissal of CEA claims (finding sufficient domestic transactions/conduct), and affirmed conspiracy-based personal jurisdiction over BASF Metals and ICBC; LPPFC claims not revived (no alter-ego pleading).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Antitrust standing under Sherman Act	Exchange Plaintiffs and KPFF allege direct injury from manipulated NYMEX/Fix prices; they are proper private enforcers	Injury is indirect (clearinghouse interposes counterparty); market-dominance test required; others more direct	Exchange Plaintiffs have antitrust standing (direct, efficient enforcers); KPFF lacks standing (indirect injury via adoption of benchmark)
CEA extraterritoriality (§22 private right)	Plaintiffs allege domestic transactions (sales on NYMEX; KPFF sales in U.S.) and domestic conduct by U.S.-based traders aiding manipulation	Defendants invoke Prime Int'l: claims predominantly foreign (benchmark and misconduct mainly abroad)	Vacated dismissal: plaintiffs pleaded sufficient domestic transactions and domestic conduct to overcome extraterritoriality challenge
Personal jurisdiction via conspiracy (BASF Metals & ICBC)	Conspiracy jurisdiction proper because U.S.-based co-conspirators committed overt acts in U.S. in furtherance of scheme	Conspiracy jurisdiction violates due process; defendants lacked minimum contacts with U.S.; unreasonable to hale foreign defendants into U.S. courts	Affirmed: complaint alleges conspiracy and overt in-forum acts by co-conspirators, satisfying Schwab framework and reasonableness factors
LPPFC alter-ego & BASF Corp involvement	Plaintiffs: LPPFC is alter ego of Fixing Members; BASF Corp. participated and should remain	Defendants: plaintiffs failed to plead "special circumstances" or shell/corporate domination; no factual allegations showing BASF Corp. role	Affirmed dismissal of LPPFC (no alter-ego pleaded) and affirmed dismissal of claims against BASF Corp. for failure to plead its involvement

Key Cases Cited

In re Am. Express Anti-Steering Rules Antitrust Litig., 19 F.4th 127 (2d Cir. 2021) (efficient-enforcer framework applied to antitrust standing)
Schwab Short-Term Bond Mkt. Fund v. Lloyds Banking Grp. PLC, 22 F.4th 103 (2d Cir. 2021) (antitrust standing and conspiracy-jurisdiction discussion)
Charles Schwab Corp. v. Bank of Am. Corp., 883 F.3d 68 (2d Cir. 2018) (conspiracy theory of personal jurisdiction standard)
Prime Int’l Trading, Ltd. v. BP P.L.C., 937 F.3d 94 (2d Cir. 2019) (CEA extraterritoriality; domestic transaction and conduct analysis)
In re Aluminum Warehousing Antitrust Litig., 833 F.3d 151 (2d Cir. 2016) (distinguishing physical-market purchasers from exchange-market participants for antitrust injury)
Morrison v. Nat’l Australia Bank Ltd., 561 U.S. 247 (U.S. 2010) (transactional test for extraterritoriality)
In re Amaranth Nat. Gas Commodities Litig., 730 F.3d 170 (2d Cir. 2013) (operation of exchange clearinghouse explained)
Associated Gen. Contractors of Cal. v. Carpenters, 459 U.S. 519 (U.S. 1983) (antitrust standing principles)
Gelboim v. Bank of Am. Corp., 823 F.3d 759 (2d Cir. 2016) (pleading conspiracy plus-factors)
Sanner v. Board of Trade, 62 F.3d 918 (7th Cir. 1995) ("lockstep" relation between cash and futures markets relevant to injury)