The world’s biggest banks won a major victory Friday when a U.S. judge dismissed a “substantial portion” of the claims in private lawsuits accusing them of rigging global benchmark interest rates.
The 16 banks had faced claims totaling billions of dollars in the case, which had been considered the biggest legal threat that they faced aside from investigations being pursued by regulators in the United States, Europe and Britain.
The banks include Bank of America, Citigroup, Credit Suisse Group, Deutsche Bank, HSBC Holdings, JPMorgan Chase, Royal Bank of Canada, Royal Bank of Scotland and WestLB.
They had been accused by a diverse body of private plaintiffs, ranging from bondholders to Baltimore City, of conspiring to manipulate the London interbank offered rate, or Libor, a key benchmark at the heart of more than $550 trillion in financial products.
In a significant setback for the plaintiffs, U.S. District Judge Naomi Reice Buchwald in Manhattan granted the banks’ motion to dismiss federal antitrust claims and partially dismissed the plaintiffs’ claims of commodities manipulation. She also dismissed racketeering and state-law claims.
Buchwald did allow a portion of the lawsuit to continue that claims that the banks’ alleged manipulation of Libor harmed traders who bet on interest rates. Small movements in those rates can mean sizable gains or losses for those gambling on which way the rates move.
Dell’s financial advisers tried to persuade 71 potential bidders to make an offer for the troubled personal computer maker before two of them emerged to challenge a proposed $24.4 billion deal with the company’s founder, according to a regulatory filing Friday.
The bidding has boiled down to a group led by company chief executive Michael Dell and Silver Lake Partners vying against alternative proposals submitted during the past week by buyout specialist Blackstone Group and billionaire investor Carl Icahn. The other potential suitors contacted by Dell’s financial advisers were not identified in Friday’s disclosures.
For now, Dell’s board is standing behind its nearly two-month-old agreement to sell the Round Rock, Tex., company to Michael Dell and Silver Lake for $24.4 billion, or $13.65 per share. But the board is still holding out the possibility that it might side with one of the offers from Blackstone or Icahn once they finalize their bids in the next few weeks. Blackstone has pledged to offer more than $14.65 per share for most of Dell’s outstanding stock, while Icahn said he plans to pay $15 per share for up to 58 percent of the company’s outstanding stock.
— Associated Press
l Facebook has invited journalists to the unveiling of what it calls its “new home on Android” on Thursday. Citing unnamed sources, the tech blog TechCrunch said Facebook will launch a modified version of Android that embeds Facebook deeply into the operating system, on a phone made by HTC.
l Ford was sued on behalf of customers in 14 states over claims that its vehicles are subject to unintentionally accelerating and lack fail-safe measures to prevent crashes. The complaint, filed Thursday in federal court in Huntington, W.Va., claims that Ford’s electronic throttle system can take control of the accelerator and leave drivers unable to stop the vehicle. The company added a brake override system in its North American cars in 2010 that it failed to include in older-model cars, according to the complaint. The plaintiffs seek compensation for the loss of vehicle value, contending owners paid too much for cars from 2002 to 2010 with defects.
l The Justice Department opposed Standard & Poor’s efforts to move a spate of lawsuits charging the ratings agency with fraud to federal from state courts. S&P is seeking to move lawsuits by 15 states and the District to the federal level, hoping to limit liabilities as it defends itself against accusations of inflating credit ratings in a bid to win fees from clients. But the Justice Department, in a filing in the U.S. District Court for the District of Connecticut on Friday, said there was no basis in law to move the cases to the higher level.
l Aaron Batalion, a co-founder of the District-based daily deals site LivingSocial, announced Friday that he is leaving the company. “After much soul searching, I have decided to leave LivingSocial to pursue some new ideas. No new adventure to announce yet,” Batalion said on his Web site. Batalion, who served as LivingSocial’s chief technology officer, is one of four co-founders of the company, and the second to leave. Eddie Frederick, LivingSocial president and co-founder, left one year ago.
— From staff reports, news services
l In Sunday Business: Excerpt from “The Alchemists: Three Central Bankers and a World on Fire,” an upcoming book by Neil Irwin.
l Monday: Motor vehicle sales and ISM manufacturing index.