Jon Hill, 31 March 2021
A Baton Rouge federal judge has freed units of Stifel Financial and Jefferies Financial from Louisiana’s lawsuit alleging Wall Street firms conspired to rig prices of bonds issued by government-sponsored enterprises like Fannie Mae and Freddie Mac, ruling the state blew its last chance to keep them in the case.
In decisions filed Tuesday, U.S. District Judge Shelly D. Dick granted dismissal with prejudice for Stifel Nicolaus & Co. Inc. and Jefferies Group LLC, which were among a slew of financial institutions sued by Louisiana’s state attorney general for allegedly gouging the state on its GSE bond purchases and sales between 2009 and 2016 with a “persistent, pervasive and secret” price-fixing conspiracy.
The case, which is on the third iteration of the state’s complaint since its 2019 filing, has been trashed by the banks as a weak copy of now-settled antitrust class action litigation in New York, and Judge Dick was unsparing in calling out Louisiana’s drafting as “sloppy” on Tuesday.
“There are numerous mistakes in the second amended complaint that can only be viewed as egregious typographical errors or examples of a haphazard copy-paste job,” Judge Dick wrote, pointing to such flaws as Louisiana’s failure to correct New York-centric references and fix terms like “Plaintiffs” and “Plaintiffs and the Class” that appear dozens of times in its latest complaint, despite the state being the only plaintiff.