A federal judge ruled Thursday that a revised lawsuit over alleged bid-rigging and price-fixing in the municipal derivatives market can proceed against a group of banks and investment firms, including JPMorgan Chase & Co., Wells Fargo & Co. and UBS AG.
U.S. District Judge Victor Marrero in Manhattan ruled that a second consolidated class-action complaint can proceed against 16 banks and investment companies. He rejected motions by the defendant banks that the revised lawsuit failed to state a claim and that the allegations were time-barred.
The lawsuit, originally filed in 2008, alleged that providers and brokers of municipal derivatives fixed their prices and rigged bids for derivatives sold to issuers of municipal bonds. A consolidated complaint filed in 2008 named more than 40 corporate defendants.
Marrero dismissed the consolidated complaint in April 2009, with leave to replead the allegations. A narrower amended complaint was filed last year.
The suit seeks to represent local governments and other entities that contracted for municipal derivatives in the U.S. and its territories from January 1992 to the present.