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UPDATE 1-Goldman, JPMorgan seek dismissal of aluminum price-fixing lawsuits
April 23, 2014 / 7:06 PM / 3 years ago

UPDATE 1-Goldman, JPMorgan seek dismissal of aluminum price-fixing lawsuits

(Adds comments from plaintiffs’ lawyer, paragraph 4-5 and 10)

By Andrew Longstreth

NEW YORK, April 23 (Reuters) - Goldman Sachs Group Inc , JPMorgan Chase & Co, the London Metal Exchange and warehouse operators want a judge to throw out lawsuits saying that from May 2009 they conspired to reduce the supply and increase the price of aluminum.

They argued in New York federal court motions late on Tuesday that commercial buyers of aluminum and consumers who purchased aluminum-based products lacked standing to sue under antitrust law because they did not store metal in the defendants’ warehouses or trade on the LME.

The lawsuits said that the defendants conspired to delay the delivery of aluminum from certain warehouses, allowing the LME and the financial firms to profit.

One of the plaintiff’s lawyers, Christopher Lovell of Lovell Stewart Halebian Jacobson, said his clients were directly injured by the defendants’ conduct, which gives them standing. Some business were forced to leave the aluminum market because of the delays, Lovell said.

“That’s one of the injuries that results from a violation of the antitrust laws,” Lovell said.

The issue of delays in the U.S. aluminum market has plagued the industry for years, but captured public and political attention only last year. The U.S. Department of Justice and the U.S. Commodity Futures Trading Commission are investigating.

In March, U.S. District Judge Katherine Forrest allowed three groups of plaintiffs to file separate lawsuits seeking class action status: direct purchaser plaintiffs, commercial end-users and consumer-end users. Forrest has scheduled a hearing in the case for Friday.

The LME has argued it was protected by the 1976 U.S. Foreign Sovereign Immunities Act, which limits when a foreign sovereign may be sued in U.S. courts.

LME said that it is an organ of the United Kingdom, entitling it to FSIA immunity. Although it is privately owned, LME argued it is “statutorily tasked with the public regulatory function of maintaining an orderly market and affording proper protection to investors.”

Lovell said that the plaintiffs “seriously contest” the LME’s claim to immunity.

The case is In Re Aluminum Warehousing Antitrust Litigation, U.S. District Court, Southern District of New York, No. 13-2481. (Reporting by Andrew Longstreth; Editing by Howard Goller and Grant McCool)

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