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Paul, Weiss is widely recognized as having one of the nation’s preeminent securities litigation and regulatory practices. For two decades, our lawyers have guided global corporations and financial institutions through a series of “bet-the-company” securities-related crises, consistently reducing or eliminating their most damaging claims and negotiating favorable resolutions.

Morgan Stanley Wins Dismissal of Class Action Concerning U.S. Treasury Securities Trading

Paul, Weiss achieved a major victory for Morgan Stanley when District Judge Paul G. Gardephe of the Southern District of New York dismissed a class action against several financial institutions that participate in the auction and trading of securities issued by the U.S. Treasury. The complaint alleged that the defendants had rigged auctions for Treasury bonds and notes and also conspired to reduce competition in the secondary market for those securities. The complaint also alleged that the defendants had colluded to block the emergence of new trading platforms through which better prices could ostensibly have been obtained for Treasury securities.

With respect to the claims concerning auctions for Treasury securities, the court held that the plaintiffs had failed to plausibly assert any direct evidence in support of their theory that the defendants had shared confidential information about customer orders ahead of the auctions to coordinate their bidding and manipulate auctions in their favor. The court also rejected various statistical analyses proffered by the plaintiffs as evidence of parallel conduct. With respect to the boycott claims, the court found that the plaintiffs had failed to allege any direct evidence of a conspiracy and rejected the plaintiffs’ allegations of parallel conduct because the plaintiffs had failed to tie any specific act to any specific defendant.

The Paul, Weiss team that prepared the motion to dismiss included litigation partners Brad Karp, Richard Rosen and Susanna Buergel

March 31, 2021

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