Supreme Court strikes down antitrust suit

June 18, 2007 at 12:36 PM
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WASHINGTON, June 18 (UPI) -- Antitrust laws don't apply to selling new stocks after they were initially offered on stock markets, the U.S. Supreme Court ruled Monday.

The 7-1 ruling written by Justice Stephen Breyer ruled federal securities regulations prevented the antitrust suit and held several Wall Street firms were immune from a class-action brought over alleged misconduct during an initial public offering, The Wall Street Journal reported.

At issue was whether certain agreements between investment banks and securities firms amounted to antitrust violations that could have supported a private antitrust lawsuit.

"We must interpret the securities laws as implicitly precluding the application of the antitrust laws to the conduct alleged in this case," Breyer wrote.

The antitrust suit accused the firms of illegally inflating prices and profit margins on IPOs during the late 1990s technology bubble.

Among the Wall Street firms sued were units of Credit Suisse Group, Bear Stearns Cos, Citigroup Inc., Goldman Sachs Group Inc., JPMorgan Chase & Co.; Lehman Brothers Holdings Inc., Merrill Lynch & Co. and Morgan Stanley.

Justice Clarence Thomas dissented and Justice Anthony Kennedy did not participate.

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