Berman Tabacco

Mexican Government Bonds Antitrust Litigation

In re Mexican Government Bonds Antitrust Litigation, No. 18-cv-02830 (JPO) (S.D.N.Y)

Berman Tabacco represents Oklahoma Firefighters Pension & Retirement System and Electrical Workers Pension Fund Local 103, I.B.E.W. in the first-filed antitrust class action against numerous financial institutions for conspiring to fix the price of various types of Mexican Government Bonds (“MGB”), including CETES, BONOS, UDIBONOS, and BONDES D. The Mexican Government issues MGBs during auctions that are dominated by the bidding of certain designated “market makers” who are the defendants in this action. The market makers purchase MGBs at auction and then sell them in the secondary market to investors like Berman Tabacco’s clients. Trillions of dollars of MGBs were traded during the period between 2006–2017, and American investors own a significant portion of the over-$200 billion in MGBs that were held at the end of that period.

Plaintiffs allege that the defendants violated federal antitrust laws by (1) rigging MGB auctions through collusive bidding and information sharing; (2) selling MGBs purchased at auction at artificially higher prices; and (3) agreeing to suppress the “bid price” at which defendants offered to buy MGBs and increase the “ask price” at which they offered to sell. Plaintiffs further allege that certain defendants are under investigation by several Mexican authorities, including Mexico’s antitrust regulator, and that one or more defendants have been accepted into Mexico’s cartel leniency program. Typically, to be accepted into the leniency program, a party must admit to participating in a conspiracy and agree to provide evidence against its co-conspirators.