August 10, 2017

The Chicago Teachers' Pension Fund is making headway battling the biggest banks in the U.S. over interest rate swaps fees, and Chicago's trading firms may be secretly cheering it on.

A federal judge in New York ruled July 28 that the pension fund's case alleging the banks have a collusive stranglehold on the interest rate swaps market could proceed. That gives the teachers' pension, and other institutional investors covered by the class action, a potential billion-dollar payout.

That would be good news for the underfunded Chicago Teachers' Pension Fund.

The Chicago Teachers' Pension Fund was drawn into the case by its attorneys at Cohen, Milstein, Sellers & Toll, who monitor the pension's $10 billion investment portfolio for litigation claims, said Carol Gilden, a Chicago litigator for the firm who is a lead attorney on the case. While neither she nor the Chicago Teachers' Pension Fund would estimate damages that could be won, she said she expects they're likely in the billions of dollars. The plaintiffs have done their own investigation and found evidence of the anticompetitive behavior, she said.

"We're going to continue to press these claims very aggressively," she added.

The full article can be read here.