Overview
Cohen Milstein represented investors in this groundbreaking antitrust class action, which alleged that 12 major Wall Street banks conspired to block competition in the multi-trillion-dollar interest rate swaps (IRS) market – one of the world’s largest financial markets, thereby preserving an opaque over-the-counter trading system that allowed them to charge investors inflated fees and costs. By suppressing exchange-based trading platforms, defendants allegedly maintained a collective stranglehold over one of the world’s largest financial markets.
Cohen Milstein and co-counsel investigated, developed, and litigated this case without the benefit of any prior government investigation or enforcement action.
On July 17, 2025, Judge J. Paul Oetken granted final approval of $71 million in cash settlements with Credit Suisse, Bank of America, JPMorgan Chase, Deutsche Bank, and the remaining defendants. In approving the settlements, Judge Oetken praised Co-Lead Counsel’s “skill, perseverance, and diligent advocacy.”
Important Rulings
- On July 17, 2025, the Honorable J. Paul Oetken of the United States District Court for the Southern District of New York, granted final approval of $71 million in total cash settlements against Credit Suisse, Bank of America, JP Morgan Chase, Deutsche Bank, and all remaining defendants.
- In his final approval order, Judge Oetken noted that “Co-Lead Counsel has pursued the litigation and achieved the Settlements with skill, perseverance, and diligent advocacy.”
- On August 3, 2016, Cohen Milstein was court appointed Interim Co-Lead Counsel. Lead Plaintiffs included Public School Teachers’ Pension and Retirement Fund of Chicago, and the Los Angeles County Employees Retirement Association.
Case Background
Interest rate swaps, which are regularly used by a broad spectrum of investors, including pension funds, university endowment funds, hedge funds, and municipalities, allow an entity to swap its fixed interest-rate payments for the floating interest-rate payments of a benchmark, or vice-versa. Given their daily use across the financial industry, interest rates swaps are a critical, multi-trillion dollar market which investors depend upon.
Interest rate swaps have been standardized and ripe for exchange trading for years. Exchange trading brings transparent and competitive pricing and faster execution to a market, thus bringing significant benefits to investors. For instance, when foreign exchange trading started to move to electronic trading platforms recently, the bid/offer spread for certain currency transactions declined by over 50 percent.
On November 25, 2015, the Public School Teachers’ Pension and Retirement Fund of Chicago filed a lawsuit in federal court to seek an injunction against a dozen Wall Street banks (Dealer Defendants), including Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan, the Royal Bank of Scotland, and UBS, to put an end to an anti-competitive arrangement the banks had to engineer and maintain a collusive and anti-competitive stranglehold over the interest rate swaps (IRS) market – one of the world’s biggest financial markets – in violation of federal antitrust laws.
As alleged in the complaint, despite the market for interest rate swaps being economically ready for standardized exchange trading, investors remained stuck trading IRS in an inefficient and antiquated market dominated by the Dealer Defendants. Since at least 2007, the Dealer Defendants jointly threatened, boycotted, coerced, and otherwise eliminated any entity or practice that had the potential to bring exchange trading to investors in the IRS market.
By blocking the entry of exchanges into the IRS market, the Dealer Defendants Dealers forced investors to trade with them in an opaque and inefficient over-the-counter market which allows the Dealer Defendants to extract billions of dollars in higher fees and costs, year after year, from the class members in this case. The Dealer Defendants maintained this profit center by conspiring to squash every potential market entrant that threatened to bring competition and transparency to the buy-side in the IRS market.
Ironically, the Dealer Defendants themselves trade IRS with each other on electronic, exchange-like platforms, but they bar investors from these platforms.
Cohen Milstein is no stranger to protecting investors in the financial industry, having recovered well over a $1.5 billion for investors over the last few years in lawsuits against major banks for securities violations with respect to mortgage-backed securities.