McCarthy v. Intercontinental Exchange, Inc.

Background

The plaintiffs, described as consumers, alleged that the defendants conspired to fix the USD LIBOR interest rate. They brought claims under Sections 1 and 2 of the Sherman Act and sought injunctive relief and treble damages under Sections 4 and 16 of the Clayton Act.

The defendants filed a joint motion under Federal Rule of Civil Procedure 12(b)(2), which allows dismissal for lack of personal jurisdiction. They also filed a separate motion under Rules 12(b)(1), 12(b)(6), and 12(b)(7), raising other challenges to the complaint. The ICE defendants filed an additional brief asserting individual grounds for dismissal.

Personal Jurisdiction

The court denied dismissal for lack of personal jurisdiction as to the United States defendants. Because the antitrust claims invoked Section 12 of the Clayton Act, the court applied a nationwide minimum-contacts analysis rather than requiring the defendants to be “at home” in California. The court found that each United States defendant was organized in a state in the United States and had its principal place of business or headquarters in the United States. The defendants did not dispute those contacts.

The court dismissed the foreign defendants for lack of personal jurisdiction, without prejudice. It found that the plaintiffs had not supported jurisdiction with affidavits or other facts, while the foreign defendants had submitted declarations concerning their contacts with the United States. The court characterized the plaintiffs’ allegations as conclusory, vague, and contradicted by the submitted materials.

Antitrust Standing

The court dismissed the claims against the United States defendants for lack of antitrust standing. Antitrust standing is a requirement beyond constitutional standing that asks whether a plaintiff is an appropriate person to bring a private antitrust claim. The court considered factors including the alleged conspirators’ specific intent, the directness and nature of the injury, the possibility of duplicative or speculative damages, and whether other plaintiffs would be more appropriate.

The court found that the complaint did not adequately address those factors. It did not explain the alleged conspirators’ specific intent or what they gained from continuing to use the publicly known LIBOR formula. The complaint also did not clearly establish which plaintiffs had financial obligations tied to LIBOR, whether they made LIBOR-linked payments, or whether LIBOR was higher than a competitive rate would have been. The court therefore concluded that the plaintiffs had not done enough to establish antitrust standing.

Disposition

The court dismissed the complaint in its entirety, with leave to amend. An amended complaint was due by October 4, 2022, and could re-allege claims against the foreign defendants dismissed without prejudice for lack of personal jurisdiction. The court declined to reach the defendants’ other arguments for dismissal. Pending further order, the case was stayed in all other respects, and the discovery dispute and request for a case schedule were terminated without prejudice. Judge Donato entered the order on September 13, 2022.