Ohio Carpenters’ Pension Fund v. Deutsche Bank AG

By Lee Berger and Travis West

On August 26, 2024, Judge Edgardo Ramos in the Southern District of New York dismissed a class action against Deutsche Bank AG, Deutsche Bank Securities Inc., Co?peratieve Rabobank U.A., and Rabo Securities USA, Inc.? The plaintiffs, several pension funds, alleged that the defendants engaged in a per se illegal agreement in violation of Section 1 of the Sherman Act to fix and manipulate the price of European government bonds (“EGBs”).? Specifically, the plaintiffs alleged that the defendants, all active participants in the secondary market for EGBs, set prices by sharing information through chatrooms.? The plaintiffs submitted evidence that the buy price the defendants would pay to purchase the EGBs was often four to five times lower than the sell price, which they alleged demonstrated collusion.

The plaintiffs had good reason to suspect some sort of collusion: the European Commission stated that Deutsche Bank and Rabobank colluded to influence prices of EGBs on December 6, 2022.? Interestingly, the same plaintiffs had brought a similar case in 2019 against various banks for the same violations (also supported by a statement from the European Commission).? Given the similarity of the claims, defenses, and supporting facts, Judge Ramos relied on this earlier case often in his opinion.

The defendants moved to dismiss, arguing that the claims were implausible, the plaintiffs lacked antitrust standing, the Court lacked personal jurisdiction over the foreign defendants, and the claims were time-barred.? The Court did not find that the claims were time-barred, finding that the plaintiffs’ reliance on the defendants’ code of conduct meant that the plaintiffs had acted with reasonable due diligence during the tolled period.?

The Court likewise rejected the defendants’ claim that the plaintiffs lacked antitrust standing.? Judge Ramos found that plaintiffs had suffered antitrust injury, rejecting the defendants’ argument that the plaintiffs had failed to specify which transactions were anticompetitive, and found that the plaintiffs were “efficient enforcers” of the antitrust laws as they had directly suffered the injury and were best situated to vindicate the claims.? (The Court did dismiss some claims between specific plaintiffs and defendants where the complaint had not alleged transactions between them.)

The plaintiffs?nonetheless failed at alleging a conspiracy.? The Court found that plaintiffs had not alleged direct evidence of a conspiracy and alleged only parallel conduct accompanied by circumstantial evidence and plus factors.? Their parallel conduct evidence consisted of a chart demonstrating that the bid-ask spread narrowed at a four to five times greater magnitude than those of a non-defendant control group in the year after the end of the class period.? Although plaintiffs portrayed it as similar to the statistical evidence that succeeded in the other EGB case, the Court agreed with defendants’?argument that it failed to discuss the market during the period.? Without any evidence during the class period, the Court was unwilling to infer activity that would support parallel conduct allegations and granted the motion to dismiss.

Because the Court dismissed the claims, it found it did not need to reach whether it had personal jurisdiction.