Friday, October 30, 2020

U.S. appeals court revives aluminum antitrust cases vs Goldman, JPMorgan, Glencore

-

A federal appeals court on Tuesday revived lawsuits by aluminum purchasers that accused Goldman Sachs, JPMorgan Chase, mining company Glencore and other companies of conspiring to drive up prices for the metal by reducing supply.

In a 3-0 decision, the 2nd U.S. Circuit Court of Appeals in Manhattan said a federal judge erred in dismissing antitrust claims by “direct” purchasers of aluminum such as Novelis, and by other purchasers including Eastman Kodak, Fujifilm and Reynolds Consumer Products.

Purchasers accused banks and commodity trading, mining and metals warehousing companies of conspiring to hoard aluminum inventory earlier this decade, after prices had declined because industrial activity fell during the global financial crisis.

The purchasers said the alleged conspiracy led to delays in processing orders and higher storage costs, ultimately inflating the cost to produce cabinets, flashlights, soft drink cans, strollers and other goods containing aluminum.

- Advertisement -

Lawyers for the defendants did not immediately respond to requests for comment.

Writing for the appeals court, Circuit Judge Pierre Leval said the purchasers could sue because they claimed to suffer harm in a market that the defendants allegedly restrained, the market to buy and sell primary aluminum.

He distinguished them from commercial end users and consumer end users, whose own antitrust claims were rejected by the appeals court in an August 2016 decision because their claimed injuries were too far removed from the alleged misconduct.

Related: Former Goldman Banker Gets Three Months for Insider Trading

Leval faulted U.S. District Judge Katherine Forrest, who has since returned to private practice, for relying on that decision to conclude that any manipulation would have occurred in the warehousing market, not the primary aluminum market.

- Advertisement -

Unlike the end users, “whose injury was an incidental byproduct of the defendants’ alleged violation, these plaintiffs’ injuries were a direct result of the defendants’ anticompetitive conduct,” Leval wrote.

The cases were returned to the federal court in Manhattan, where they are now overseen by U.S. District Judge Denise Cote.

“We’re pretty excited,” Patrick Coughlin, a lawyer for the direct purchasers, said in an interview.

“Even if manipulation took place in another market, if it were directed toward our clients’ markets and inflated the price of aluminum there, we should be able to bring an antitrust case,” he added. “We’re ready to go to trial.”

Lawyers for Kodak and Fujifilm, and a lawyer for Reynolds, did not immediately respond to requests for comment.

The case is Eastman Kodak Co et al v Henry Bath LLC et al, 2nd U.S. Circuit Court of Appeals, Nos. 16-4230, 16-4233, 16-4235, 16-4243, 16-4305 and 16-4308.

MUST READ

FirstEnergy fires CEO, other executives over Ohio bribery scandal

FirstEnergy Corp. has fired its CEO amid multiple federal investigations related to an Ohio nuclear bailout law passed year. The Akron-based utility company announced in a...

Ukraine’s court strips critical power from anti-corruption agency

Ukraine's Constitutional Court has stripped the country’s anti-corruption agency of some of its critical powers. The high court’s ruling published on October 28 declared it...

Former South Korean President Lee Myung-bak sent back to prison for 17 years in corruption case

Former South Korean president Lee Myung-bak was ordered back to prison on Thursday (Oct 29) as the country's Supreme Court upheld a 17-year jail...

Nigerian court declines to issue international arrest warrant for fugitive ex-Petroleum Minister in corruption case

The Abuja Division of the Federal High Court, on Wednesday, refused an application by the Economic and Financial Crimes Commission, EFCC, for an arrest...

South Korea’s former Vice Justice Minister sentenced to jail for bribery and sexual favors

Former Vice Justice Minister Kim Hak-eui, the figure at the center of one of Korea’s biggest political sex scandals, was placed under pretrial detention...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World

Advertisement
Advertisement

Latest News

This Week

Namibia probes oil firm Acer petroleum over bribes paid to government officials

THE mines and energy ministry says it is investigating allegations that an oil company bribed some senior officials to fast-track licence applications. The senior officials...

Nigerian court declines to issue international arrest warrant for fugitive ex-Petroleum Minister in corruption case

The Abuja Division of the Federal High Court, on Wednesday, refused an application by the Economic and Financial Crimes Commission, EFCC, for an arrest...

Beam Suntory Inc. fined $19.6 million in foreign bribery case

Beam Suntory Inc. (Beam), a Chicago-based company that produces and sells distilled beverages, has agreed to pay a criminal monetary penalty of $19,572,885 to...

Macau to sign agreement with World Bank Group over money laundering risk assessment

Secretary for Security Wong Sio Chak was granted powers by the Chief executive to sign a Reimbursable Advisory Services Agreement Concerning Risk Assessment of...
Advertisement

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks