Two new plaintiffs join US stock loan lawsuit

Two new plaintiffs join US stock loan lawsuit

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Two new plaintiffs - Los Angeles County Employees Retirement Association (LACERA) and Torus Capital - have joined a class action lawsuit alleging that major banks conspired to control the securities lending market. 

A 144 page amended complaint, filed in New York late on Friday, listed the $50 billion LACERA pension fund and Torus, a proprietary trading firm focused on futures and options, as new plaintiffs.

They join the original party that filed suit earlier this year - Iowa Public Employees Retirement System (IPERS), Orange County Employees Retirement System and Sonoma County Employees' Retirement Association.

Lawyers at Quinn Emanuel Urquhart & Sullivan LLP and Cohen Milstein Sellers & Toll are representing the plaintiffs.

The defendants - Bank of America, Credit Suisse, Goldman Sachs, J.P. Morgan, Morgan Stanley and UBS - have also appointed top antitrust lawyers. 

Each of the six bank defendants part-own EquiLend, which is also being sued.

The revised suit alleges that the banks "directly conspired through and with EquiLend" to prevent the emergence of efficient electronic trading systems in the stock lending market.

Specifically, the plaintiffs allege that the banks routinely took steps together to block the development of AQS in the United States (now owned by EquiLend and named EquiLend Clearing Services) and SL-x in Europe.

A significant amount of insider information (valid or not) is referenced in the filing, and many industry participants and specifically named. 

 

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