Sonterra Capital Master Fund v. Barclays Bank Plc (366 F. Supp. 3d 516, 2018)

United States District Court for the Southern District of Illinois 2018-12-21

Commerce and Trade Agriculture

Citations

Full opinion text

In an alleged price-fixing conspiracy, each overt act that is part of the violation and that injures the plaintiff starts the statutory period running again, regardless of the plaintiff's knowledge of the alleged illegality at much earlier times. Plaintiffs may only recover damages based on acts falling within the statutory period, and not based on previous acts.

Merced Irrigation Dist. v. Barclays Bank PLC , 165 F.Supp.3d 122, 134-35 (S.D.N. Y, 2016) (citations and internal quotation marks omitted); see also Zenith Radio Corp. v. Hazeltine Research, Inc. , 401 U.S. 321, 338, 91 S.Ct. 795, 28 L.Ed.2d 77 (1971).

b. RICO Claims

RICO claims are subject to a four-year statute of limitations. Koch v. Christie's Int'l PLC , 699 F.3d 141, 148 (2d Cir. 2012). "As a general matter, 'the limitations period does not begin to run until a plaintiff has actual or inquiry notice of the injury.' " Id. at 150-51 (quoting In re Merrill Lynch Ltd. P'ships Litig. , 154 F.3d 56, 60 (2d Cir. 1998) ).

Inquiry notice-often called "storm warnings" in the securities context-gives rise to a duty of inquiry "when the circumstances would suggest to an investor of ordinary intelligence the probability that she has been defrauded." In such circumstances, the imputation of knowledge will be timed in one of two ways: (i) "if the investor makes no inquiry once the duty arises, knowledge will be imputed as of the date the duty arose"; and (ii) if some inquiry is made, "we will impute knowledge of what an investor in the exercise of reasonable diligence should have discovered concerning the fraud, and in such cases the limitations period begins to run from the date such inquiry should have revealed the fraud."

Koch , 699 F.3d at 151 (quoting Lentell v. Merrill Lynch & Co. , 396 F.3d 161, 168 (2d Cir. 2005) ). " 'Storm warnings' need not detail every aspect of the alleged fraudulent scheme: 'An investor does not have to have notice of the entire fraud being perpetrated to be on inquiry notice.' " Staehr , 547 F.3d at 427 (quoting Dodds v. Cigna Sec., Inc. , 12 F.3d 346, 352 (2d Cir. 1993) ). "Rather, a totality-of-the-circumstances analysis applies." Id. Whether a plaintiff was on inquiry notice is "analyzed under an objective standard," and may be "resolved as a matter of law." Id.

c. CEA Claims

An action brought under the CEA "shall be brought not later than two years after the date the cause of action arises." 7 U.S.C. § 25(c). "Because the CEA does not define when a cause of action accrues, courts apply a discovery accrual rule wherein discovery of the injury, not discovery of the other elements of a claim, is what starts the clock." In re London Silver Fixing , Ltd., Antitrust Litig. ("In re Silver "), 213 F.Supp.3d 530, 573 (S.D.N.Y. 2016) (quoting Koch , 699 F.3d at 148-49 ). "Applying the corollary doctrine of 'inquiry notice,' a court must 'ask at what point the circumstances were such that they would suggest to a person of ordinary intelligence the probability that she has been defrauded.' " LIBOR III , 27 F.Supp.3d at 471 (quoting LIBOR I , 935 F.Supp.2d at 698 ); see also Sullivan , 2017 WL 685570, at *26 ("The limitations period begins to run when a plaintiff is placed on inquiry notice of the alleged wrongdoing through facts that 'suggest to a person of ordinary intelligence' that the CEA has been violated." (quoting Benfield v. Mocatta Metals Corp. , 26 F.3d 19, 22 (2d Cir. 1994) ) ); In re Silver , 213 F.Supp.3d at 573 (comparing inquiry notice in the CEA context to storm warnings in the securities context).

d. Doctrine of Fraudulent Concealment

"Under federal common law, a statute of limitations may be tolled due to the defendant's fraudulent concealment if the plaintiff establishes that: (1) the defendant wrongfully concealed material facts relating to defendant's wrongdoing; (2) the concealment prevented plaintiff's discovery of the nature of the claim within the limitations period; and (3) plaintiff exercised due diligence in pursuing the discovery of the claim during the period plaintiff seeks to have tolled." Koch , 699 F.3d at 157 (quoting Corcoran v. N.Y. Power Auth. , 202 F.3d 530, 543 (2d Cir. 1999) ). The rationale behind the doctrine "is to prevent a defendant from 'concealing a fraud, or committing a fraud in a manner that it concealed itself until such time as the party committing the fraud could plead the statute of limitations to protect it.' " State of N.Y. v. Hendrickson Bros. , 840 F.2d 1065, 1083 (2d Cir. 1988) (quoting Bailey v. Glover , 88 U.S. (21 Wall.) 342, 349, 22 L.Ed. 636 (1874) ).

The first prong is met where " 'the nature of the wrong itself' is self-concealing." Sullivan , 2017 WL 685570, at *27 (quoting Nat'l Grp. for Commc'ns & Computers Ltd. v. Lucent Techs. Inc. , 420 F.Supp.2d 253, 267 n.20 (S.D.N.Y. 2006) ); see also Levy v. BASF Metals Ltd. , No. 1:15-cv-7317-GHW, 2017 WL 2533501, at *8 (S.D.N.Y. June 9, 2017). Allegations of price-fixing conspiracies are often considered inherently self-concealing. See Merced , 165 F.Supp.3d at 135 ("Allegations of price-fixing conspiracies in violation of antitrust law constitute the type of unlawful activity that is inherently self-concealing."); In re Nine W. Shoes Antitrust Litig. , 80 F.Supp.2d 181, 193 (S.D.N.Y. 2000) ("[S]ince ... price-fixing conspiracies are deemed self-concealing, a plaintiff is not required to show defendants took independent affirmative steps to conceal their conduct.").

"A claim for fraudulent concealment must be pled with particularity, in accordance with the heightened pleading standards of Rule 9(b) of the Federal Rules of Civil Procedure." Merced , 165 F.Supp.3d at 135. However, "because resolution of a claim of fraudulent concealment is intimately bound up with the facts of the case, it often cannot be decided at the motion to dismiss stage." In re Commodity Exch., Inc. , 213 F.Supp.3d 631, 675 (S.D.N.Y. 2016) (internal quotation marks omitted).

2. Application

Sonterra's initial complaint was filed on May 6, 2015. FrontPoint and Dennis's complaint was filed on January 21, 2016. The conduct at issue is alleged to have occurred during the Class Period-January 1, 2005 through December 31, 2010. (CAC ¶ 217.) Although Plaintiffs may have been aware of the identities of the panel members, they claim not to have known which of the panel members participated in the conspiracy, and thus lacked notice of their claims, until the Government settlements became public: Barclays on June 27, 2012, (id. ¶ 46), UBS on December 18, 2012, (id. ¶ 17 n.8), RBS on February 6, 2013, (id. ¶ 73), Rabobank on October 29, 2013, (id. ¶ 20 n.15), Lloyds on July 28, 2014, (id. ¶ 22 n.20), and Deutsche Bank on April 23, 2015, (id. ¶ 13 n.2). Therefore, Plaintiffs concede that their CEA claims against Barclays, UBS, and RBS are time-barred under the applicable two-year statute of limitations, (Pls.' SMJ Opp. 47 n.36) , but argue that their remaining CEA claims against Rabobank, Deutsch Bank, and Lloyds, as well as their antitrust and RICO claims against all Defendants, are tolled by the doctrine of fraudulent concealment.

Defendants argue that Plaintiffs were on notice of their claims as early as May 2008. (Defs.' SMJ Br. 25-30, 46-47.) As support for their argument, Defendants identify and include a number of surveys, articles, and reports (the "2008 press reports") that they assert placed Plaintiffs on inquiry notice in 2008. (See Gottridge Decl. Exs. A-H.) These same materials have been discussed by a number of other courts in this District examining the issue of inquiry notice. As comprehensively summarized by Judge Furman, the 2008 press reports conveyed the following information:

On April 10, 2008, strategists at Citigroup published a report comparing LIBOR to other interest rate measures and concluding that "LIBOR may understate actual interbank lending costs" by twenty to thirty basis points (or twenty to thirty hundreths of a percentage point). The strategists explained:

"The most obvious explanation for LIBOR being set so low is the prevailing fear of being perceived as a weak hand in this fragile market environment. If a bank is not held to transact at its posted LIBOR level, there is little incentive for it to post a rate that is more reflective of real lending levels, let alone one that is higher than its competitors. Because all LIBOR postings are publicly disclosed, any bank posting a high LIBOR level runs the risk of being perceived as needing funding. With markets in such a fragile state, this kind of perception could have dangerous consequences."

Six days later, the Wall Street Journal published an article citing the Citigroup report and warning that "one of the most important barometers of the world's financial health could be sending false signals." The article reported that the BBA, which oversees LIBOR, was conducting an investigation into potential problems with the rate.

Two more articles in the Wall Street Journal followed in quick succession. The following day, April 17, 2008, the Journal reported that the BBA had "fast-tracked its inquiry into the accuracy of the rate." The Journal noted that the BBA's announcement "came as more traders and bankers expressed concerns about" the validity of LIBOR. And on April 18, 2008, the Journal reported a "sudden jump in the dollar-denominated London interbank offered rate, or LIBOR," in the wake of the announcement that the BBA was accelerating its inquiry into the rate's accuracy. The article reiterated "concerns among bankers that the LIBOR panel banks were not reporting the high rates they were paying for short-term loans for fear of appearing desperate for cash."

Nor was the Wall Street Journal the only news outlet reporting on concerns surrounding LIBOR. On April 21, 2008, the Financial Times reported that "the credibility of Libor as a measure is declining." In particular, the Times explained that, as the paper had "first revealed" in 2007, "bankers have been questioning the way Libor is compiled ever since the credit turmoil first erupted." On May 16, 2008, Reuters published an article discussing "problems with Libor," and noting that "recent concern had focused particularly on the dollar Libor index and worries that some banks were understating how much they had to pay to borrow money in order to avoid being labeled desperate for cash and, as a result, vulnerable to solvency rumors." And on May 29, 2008, Bloomberg published an article, the first line of which stated: "Banks routinely misstated borrowing costs to the British Bankers' Association to avoid the perception they faced difficulty raising funds as credit markets seized up, said Tim Bond, a strategist at Barclay Capital."

Amidst growing concern about LIBOR's reliability, the Wall Street Journal conducted its own study. Its results-published in a May 29, 2008 article-revealed that "in the first four months of 2008, the three-month and six-month dollar Libor rates were about a quarter percentage point lower than" the Journal 's analysis suggested they should have been. The data showed, further, that "after banks adjusted their Libor rates following news of the BBA review in mid-April, the difference between the reported rates and what rates should have been shrunk to about 0.15 percentage point." Three experts, the Journal reported, approved of its methodology. By May 29, 2008, then, there were at least seven articles in major publications reporting that there was substantial evidence to support the conclusion that LIBOR was artificially low and had been so for some time.

BPP Ill., LLC v. Royal Bank of Scot. Grp., PLC , No. 13 Civ. 0638(JMF), 2013 WL 6003701, at *7-8 (S.D.N.Y. Nov. 13, 2013) (citations omitted), aff'd in part, vacated in part , 603 F. App'x 57 (2d Cir. 2015) (summary order); see also LIBOR I , 935 F.Supp.2d at 700-03 (describing same articles). Applying Pennsylvania's discovery rule, Judge Furman concluded that these articles were sufficient storm warnings to raise the possibility that the US-dollar LIBOR was not a legitimate and reliable market-based interest rate; therefore, the plaintiffs were not reasonably unaware of their injury. BPP Ill., LLC v. Royal Bank of Scot. Grp., PLC, No. 13 Civ. 0638(JMF) , 2013 WL 6003701, at *6-7. The Second Circuit reversed in a summary order, stating that the district court erroneously held plaintiffs to too high a standard of proof at the motion to dismiss stage by requiring plaintiffs to exhibit reasonable diligence in not discovering their injury in response to the storm warnings. See 603 F. App'x at 59. Because plaintiffs were "not required to plead, in a complaint, facts sufficient to overcome an affirmative defense," the Second Circuit concluded that the record was insufficient to show that the plaintiffs had not exercised reasonable diligence. See id. at 59 (internal quotation marks omitted).

On remand, Judge Furman concluded that the plaintiffs were judicially estopped from bringing LIBOR-based fraud claims because they failed to list them in their schedule of assets in a prior bankruptcy proceeding. See BPP Ill., LLC v. Royal Bank of Scot. Grp., PLC , No. 13-CV-638 (JMF), 2015 WL 6143702, at *9 (S.D.N.Y. Oct. 19, 2015). The Second Circuit affirmed and, relying on Fifth Circuit law, held that the 2008 press reports were sufficient to "suggest that [the plaintiffs] may have [had] a possible cause of action." BPP Ill., LLC v. Royal Bank of Scot. Grp., PLC , 859 F.3d 188, 193 & n.3 (2d Cir. 2017) (quoting In re Coastal Plains, Inc. , 179 F.3d 197, 210 (5th Cir. 1999) ). In a footnote, the Court reconciled its decisions as follows:

In the previous appeal in this case, we stated that the district court had acted too hastily in concluding, based in part on these newspaper reports, that BPP should have been aware of its potential LIBOR-fraud claims. In that appeal, however, we considered a different question under a different body of law. The issue was whether BPP had sufficient inquiry notice under the relevant Pennsylvania statute of limitations. That question turned on when the plaintiff reasonably should have known that he had been injured and that his injury had been caused by another party's conduct. In this appeal, controlled by Fifth Circuit bankruptcy precedents, the question is whether the debtor has enough information prior to confirmation to suggest that it may have a possible cause of action. The tests are different, and a bankruptcy debtor in the Fifth Circuit could be required to list a cause of action in its schedule of assets even though the same debtor would not be deemed to have inquiry notice of his injury for purposes of the Pennsylvania statute of limitations.

Id. at 193 n.3 (citations and internal quotation marks omitted).

The Second Circuit's recent decision in Charles Schwab Corp. v. Bank of America Corp. , 883 F.3d 68 (2d Cir. 2018), also addressed the significance of the 2008 press reports. In that case, the Circuit-albeit applying California law-reversed the district court's determination that the plaintiff was on inquiry notice based on reports published by May 29, 2008. See id. at 96-98. The Second Circuit's decision rested, in part, on California law, under which press reports are not sufficient to put a plaintiff on inquiry notice "where there is no evidence that the plaintiff was aware of the reporting in question." Id. at 97. The Circuit further stated that

even if Schwab were aware of news articles that raised the possibility that LIBOR had been at artificial levels since August 2007, it is not certain that any of Schwab's claims would be time-barred. The BBA responded to the negative press reporting by assuring investors and journalists that its own investigation had confirmed the accuracy of LIBOR.

It is plausible that Schwab reasonably relied on those assurances, thus delaying the start of the limitations period.

Id. at 98 (citing BPP Ill., LLC , 603 F. App'x at 59 ). "The Second Circuit's analysis strongly suggests that, even if the news articles published on or about May 29, 2008 are sufficient to place a plaintiff on inquiry notice, the statute of limitations would be tolled under the doctrine of fraudulent concealment where a plaintiff plausibly alleges that it relied on the BBA's assurances that LIBOR was accurate." 7 W. 57th St. Realty Co. , 314 F.Supp.3d at 518.

Here, Plaintiffs' allegations clear the first hurdle of the fraudulent concealment test because the nature of LIBOR submissions is inherently secretive, and therefore collusion related to such submissions is self-concealing. See Sullivan , 2017 WL 685570, at *27. As to the second factor, Plaintiffs adequately allege that they remained ignorant of the alleged scheme until a point within the relevant statutes of limitations-when the Government settlements became public. (See CAC ¶ 20 n.15 (Rabobank on October 29, 2013); id. ¶ 22 n.20 (Lloyds on July 28, 2014); id. ¶ 13 n.2 (Deutsche Bank on April 23, 2015).)

With regard to the third element-whether Plaintiffs exercised due diligence in pursuing the discovery of the claim during the period they seek to have tolled-Defendants argue that the 2008 press reports put Plaintiffs on inquiry notice of a cause of action prior to the Government settlements, thereby triggering the need for diligence. As an initial matter, the 2008 press reports did not explicitly suggest that panel banks were manipulating Sterling LIBOR, which distinguishes this case from the U.S.-dollar LIBOR decisions that tolled the statute of limitations notwithstanding those same reports. Further, it is unclear that the 2008 press reports should have alerted Plaintiffs to their various claims, as those reports may not have provided Plaintiffs with a basis to allege a cognizable theory of liability against each specific Defendant. See Sullivan , 2017 WL 685570, at *28 (rejecting defendants' argument that "October 2011 press reports about possible Euribor manipulation should have alerted plaintiffs to their claims" because "those early reports did not provide plaintiffs with information sufficient to identify each defendant or a good-faith basis to allege a cognizable theory of liability"). Indeed, Plaintiffs claim not to have known which panel members participated in the conspiracy until the Government settlements became public.

Moreover, even if the 2008 press reports were sufficient to place Plaintiffs on inquiry notice, "the statute of limitations would be tolled under the doctrine of fraudulent concealment where [P]laintiff plausibly alleges that it relied on the BBA's assurances that LIBOR was accurate." 7 W. 57th St. Realty Co. , 314 F.Supp.3d at 518 ; see also Schwab , 883 F.3d at 97-98. Although Plaintiffs' due diligence allegations are thin, the CAC alleges that Defendants' agreements to manipulate Sterling LIBOR were "intentionally self-concealing" and that through the BBA, Defendants were representing that their Sterling LIBOR quotes were accurate. (See, e.g. , CAC ¶ 230.) I therefore find that Plaintiffs have adequately alleged fraudulent concealment, and at the pleading stage, I need not determine the precise contours of the applicable tolling period. See In re Commodity Exch., Inc. , 213 F.Supp.3d at 676. Accordingly, Plaintiffs' antitrust and RICO claims against all Defendants and CEA claims against Rabobank, Deutsche Bank, and Lloyds are not barred by their applicable statutes of limitations.

B. Antitrust Claims

The Consolidated Amended Complaint asserts two antitrust claims under Section 1 of the Sherman Act: First, that Defendants conspired with each other and with brokers to make false Sterling LIBOR submissions; and second, that Defendants conspired through trading strategies to affect other banks' Sterling LIBOR submissions. In addition to the statute of limitations arguments addressed above, see supra Part V.A, Defendants argue that these claims should be dismissed because (1) Plaintiffs lack antitrust standing; (2) the claims are barred by the Foreign Trade Antitrust Improvements Act of 1982 ("FTAIA"), 15 U.S.C. § 6a ; and (3) the CAC fails to plausibly allege an antitrust conspiracy.

1. Antitrust Standing

Defendants primarily argue that Plaintiffs lack antitrust standing because (1) Plaintiffs do not allege they were customers or competitors of Defendants (with one exception), and (2) Plaintiffs' injury is too speculative to allow them to be "efficient enforcers" of the antitrust laws. (Defs.' SMJ Br. 16-19.) As discussed below, I find that Plaintiffs Sonterra and Dennis lack antitrust standing, but find that Plaintiff FrontPoint has antitrust standing to pursue its claims against Defendant UBS.

a. Applicable Law

Section 4 of the Clayton Act provides in relevant part that "any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue ... in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee." 15 U.S.C. § 15(a). This language has been interpreted in this Circuit to mean that a plaintiff alleging antitrust claims must establish antitrust standing in addition to constitutional standing under Article III. See In re Aluminum Warehousing Antitrust Litig. , 833 F.3d 151, 157 (2d Cir. 2016). "Harm to the antitrust plaintiff is sufficient to satisfy the constitutional standing requirement of injury in fact, but the court must make a further determination whether the plaintiff is a proper party to bring a private antitrust action." Gelboim , 823 F.3d at 770 (quoting AGC , 459 U.S. at 535 n.31, 103 S.Ct. 897 ).

To adequately plead antitrust standing, a plaintiff must plausibly allege that (1) it suffered an antitrust injury, meaning injury "of the type the antitrust laws were intended to prevent and that flows from that which makes defendants' acts unlawful," and (2) it is an acceptable plaintiff to pursue the alleged antitrust violations, in satisfaction of the "efficient enforcer" factors. Gordon v. Amadeus IT Grp., S.A. , 194 F.Supp.3d 236, 246 (S.D.N.Y. 2016) (quoting Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc. , 429 U.S. 477, 489, 97 S.Ct. 690, 50 L.Ed.2d 701 (1977) ; AGC , 459 U.S. at 538-45, 103 S.Ct. 897 ); see also Gelboim , 823 F.3d at 778 ; Aluminum Warehousing , 833 F.3d at 157.

b. Application: Antitrust Injury

As an initial matter, the CAC alleges that Defendants engaged in a horizontal price-fixing scheme, which is a per se antitrust violation. See Gelboim , 823 F.3d at 771. As in Gelboim , Plaintiffs allege that the banks colluded to manipulate the Sterling LIBOR, and thereby increased the cost to buyers of various LIBOR-based instruments. (See CAC ¶¶ 13-25, 126-42). "Generally, when consumers, because of a conspiracy, must pay prices that no longer reflect ordinary market conditions, they suffer 'injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendants' acts unlawful.' " Gelboim , 823 F.3d at 772 (quoting Brunswick , 429 U.S. at 489, 97 S.Ct. 690 ). The CAC therefore adequately pleads antitrust injury based on the price-fixing's effect on the prices for LIBOR-based financial instruments. "No further showing of actual adverse effect in the marketplace is necessary. This attribute separates evaluation of per se violations-which are presumed illegal-from rule of reason violations, which demand appraisal of the marketplace consequences that flow from a particular violation." Id.

Prior to the Second Circuit's decision in Gelboim , Defendants argued that Plaintiffs failed to allege antitrust injury, relying on Judge Buchwald's conclusion in LIBOR I that, because LIBOR-setting is a cooperative rather than competitive process, the alleged conduct cannot be the source of an antitrust injury. (Defs.' SMJ Br. 14-15.) Gelboim rejected Judge Buchwald's antitrust injury analysis and held that manipulating LIBOR is a per se violation of antitrust laws that causes antitrust injury to anyone who transacted in financial instruments with prices influenced by that rate. See 823 F.3d at 771. Here, the CAC alleges that the financial instruments purchased by Plaintiffs were priced, benchmarked, or settled based on Sterling LIBOR. In light of Gelboim , Plaintiffs have clearly sufficiently alleged that they have suffered an antitrust injury in the form of higher prices flowing from the alleged corruption of the rate-setting process. Accordingly, Plaintiffs have adequately alleged antitrust injury.

c. Application: Efficient Enforcer of the Antitrust Laws

"The four efficient enforcer factors are: (1) the 'directness or indirectness of the asserted injury,' which requires evaluation of the 'chain of causation' linking appellants' asserted injury and the Banks' alleged price-fixing; (2) the 'existence of more direct victims of the alleged conspiracy'; (3) the extent to which appellants' damages claim is 'highly speculative'; and (4) the importance of avoiding 'either the risk of duplicate recoveries on the one hand, or the danger of complex apportionment of damages on the other.' " Id. at 778 (quoting AGC , 459 U.S. at 540-45, 103 S.Ct. 897 ). "Courts sometimes weigh a fifth consideration: 'whether the putative plaintiff is a proper party to perform the office of a private attorney general and thereby vindicate the public interest in antitrust enforcement.' " Sullivan , 2017 WL 685570, at *15 (quoting Gatt , 711 F.3d at 80 ). "A determination of standing in an individual antitrust case is a fact-specific exercise involving a fact-intensive inquiry." In re Platinum & Palladium Antitrust Litig. ("Platinum "), No. 1:14-cv-9391-GHW, 2017 WL 1169626, at *20 (S.D.N.Y. Mar. 28, 2017) (citing AGC , 459 U.S. at 536-37, 103 S.Ct. 897 ).

i. Causation

The first factor addresses the "directness or indirectness of the asserted injury," which "requires evaluation of the 'chain of causation' linking [plaintiff's] asserted injury and the [defendants'] alleged price-fixing." Gelboim , 823 F.3d at 778 (quoting AGC , 459 U.S. at 540, 103 S.Ct. 897 ). "The antitrust laws do not require a plaintiff to have purchased directly from a defendant in order to have antitrust standing." Platinum , 2017 WL 1169626, at *20 (quoting In re Foreign Exch. Benchmark Rates Antitrust Litig. ("FOREX "), No. 13 Civ. 7789 (LGS), 2016 WL 5108131, at *9 (S.D.N.Y. Sept. 20, 2016) ). However, whether Plaintiffs dealt directly or indirectly with Defendants, as well as the scope of the relevant market, are both relevant to the issue of causation. See Gelboim , 823 F.3d at 778. The Second Circuit in Gelboim expressed concern over "umbrella standing"-a plaintiff injured by dealing with a non-defendant by virtue of a defendant's raising of prices in the market as a whole. Id. Gelboim acknowledged a circuit split concerning whether umbrella purchasers have antitrust standing but declined to adopt a position. Id. at 778-79 ; see also Platinum , 2017 WL 1169626, at *22. The court in Gelboim noted that while "there appears to be no difference in the injury alleged by those who dealt in LIBOR-denominated instruments, whether ... directly or indirectly with the Banks," the Banks appeared to "control only a small percentage of the ultimate identified market." Gelboim , 823 F.3d at 779. The Second Circuit cautioned that "[r]equiring the Banks to pay treble damages to every plaintiff who ended up on the wrong side of an independent LIBOR-denominated derivative swap would, ... not only bankrupt 16 of the world's most important financial institutions, but also vastly extend the potential scope of antitrust liability in myriad markets where derivative instruments have proliferated." Id.

The concern with so-called umbrella purchasers is that "significant intervening causative factors, most notably, the independent pricing decisions of non-conspiring retailers, attenuate the causal connection between the violation and the injury." LIBOR VI , 2016 WL 7378980, at *15 (internal quotation marks omitted). For that reason, courts in this District have "[drawn] a line between plaintiffs who transacted directly with defendants and those who did not" because "the 'independent decision' of contracting parties to incorporate LIBOR 'breaks the chain of causation between defendants' actions and a plaintiff's injury.' " Sullivan , 2017 WL 685570, at *17 (quoting LIBOR VI , 2016 WL 7378980, at *16 ); see also FOREX , 2016 WL 5108131, at *7 ; Platinum , 2017 WL 1169626, at *22. Courts have been "able to draw that line in part by acknowledging that 'plaintiffs who did not purchase directly from defendants continue to face the same hurdle: they made their own decisions to incorporate LIBOR into their transactions, over which defendants had no control, in which defendants had no input, and from which defendants did not profit.' " Platinum , 2017 WL 1169626, at *22 (quoting LIBOR VI , 2016 WL 7378980, at *16 ).

Here, Plaintiffs Sonterra and Dennis assert exactly the sort of "umbrella claims" that the Circuit viewed with skepticism, since their claims are based solely on financial transactions with third-parties, and not with Defendants. See FrontPoint Asian Event Driven Fund, L.P. v. Citibank, N.A. , 16 Civ. 5263 (AKH), 2018 WL 4830087, at *5-6 (S.D.N.Y. Oct. 4, 2018) (dismissing Sonterra's antitrust claims because "Sonterra's transactions with third-parties [were] insufficient to give it antitrust standing to sue [the defendants]"). Moreover, the relationship between Sterling LIBOR-on the one hand-and Sonterra's Sterling FX Forwards and Dennis's Sterling FX Futures-on the other-while enough to confer Article III standing, supra Part IV, is more attenuated than the relationship between LIBOR and the "LIBOR-denominated"

transactions in Gelboim , see 823 F.3d at 779 ; indeed, the FX Forwards of Sonterra and the FX Futures of Dennis incorporated LIBOR only implicitly through a complex formula involving numerous other causal factors. These sort of "vaguely defined links," AGC , 459 U.S. at 540, 103 S.Ct. 897, suggest that the causal relationship is too indirect to support the causation element of the efficient enforcer prong for antitrust standing, see Laydon I , 2014 WL 1280464, at *9 ; 7 W. 57th St. Realty Co. , 314 F.Supp.3d at 512-14.

Because Plaintiff FrontPoint is alleged to have dealt with Defendant UBS directly, its claims do not suffer from the same causation problems. (See CAC ¶ 38.)

ii. Existence of More Direct Victims

Whether a plaintiff is a consumer or competitor is relevant to the second factor, but not dispositive. See Gelboim , 823 F.3d at 779. Like the plaintiffs in Gelbiom , "one peculiar feature of this case is that remote victims (who acquired LIBOR-based instruments from any of thousands of non-defendant banks) would be injured to the same extent and in the same way as direct customers of the Banks." Id . Accordingly, I give the existence of more direct victims "diminished weight" in determining whether Plaintiffs are efficient enforcers of the antitrust laws. Id. ; see also LIBOR VI , 2016 WL 7378980, at *17 ; Sullivan , 2017 WL 685570, at *18.

iii. Speculative Damages

"[H]ighly speculative damages is a sign that a given plaintiff is an inefficient engine of enforcement." Gelboim , 823 F.3d at 779. While "some degree of uncertainty stems from the nature of antitrust law" and is permitted, plaintiffs must be able allege that they could arrive at a just and reasonable estimate of damages. Id. ; see also Platinum , 2017 WL 1169626, at *23 (stating that plaintiffs "carry the burden of coming forward with a just and reasonable estimate of damages" (internal quotation marks omitted) ). "As with most antitrust cases, to establish damages, Plaintiffs will have to offer a reliable 'but-for' world. At a minimum, that 'but-for' world will require Plaintiffs to establish (1) what an alternative Fix Price would have been absent collusion, and (2) the behavior of [defendants] absent a Fix Price affected by collusion." Id. (citations omitted). "Whether damages calculations will be too speculative and, therefore, unreliable, depends on 'the nature and complexity of the alleged antitrust violation.' " Id. (quoting Gelboim , 823 F.3d at 779 ).

Gelboim noted the "unusual challenges" that are also present in this case: "The disputed transactions were done at rates that were negotiated, notwithstanding that the negotiated component was the increment above LIBOR. And the market for money is worldwide, with competitors offering various increments above LIBOR, or rates pegged to other benchmarks, or rates set without reference to any benchmark at all." 823 F.3d at 780. In evaluating whether damages are unduly speculative in price-fixing cases, considerations include (1) the extent to which the damages claim is conclusory in nature; (2) whether the injury is "so far down the chain of causation from defendants' actions that it would be impossible to untangle the impact of the fixed price from the impact of intervening market decisions," which relates to the causation factor; (3) whether external market factors affected the "relationship between the fixed price and the price that the plaintiffs ultimately paid;" and (4) whether "the non-fixed components of a transaction were heavily negotiated between the parties in relation to the fixed component." LIBOR VI , 2016 WL 7378980, at *17-18 (citations omitted).

In LIBOR VI , Judge Buchwald found "highly negotiated transactions," such as interest rate swaps, to be the kind of transactions that "absorb[ ] the effects of LIBOR suppression." Id. at *20. Similarly, Plaintiff Sonterra's Sterling FX Forwards are also the sort of highly negotiated contracts that incorporate numerous considerations as to make the effect of Sterling LIBOR manipulation highly speculative. This factor weighs against finding antitrust standing for Sonterra.

With respect to futures contracts purchased on an exchange, such as those purchased by Plaintiff Dennis, Judge Buchwald found that

[t]he mathematical relationship between LIBOR and the settlement price of Eurodollar futures contracts does not address the relationship, if any, between LIBOR and the trading price of ... futures contracts (that is, the price at which ... futures contracts were bought and sold prior to settlement). The trading price reflects the market's prediction for what the price will be at settlement, which could be years away-not what LIBOR is at the present moment.

Id. at *21. Judge Buchwald concluded that the effect of LIBOR on the trading price could only be established if the trading price and settlement price were closely related. Id. She found that the Exchange-based plaintiffs had not sufficiently pled a close relationship between the LIBOR and trading prices, and that damages based on an impact of LIBOR manipulation on the futures trading prices was speculative. Id. at *22-23. The only Exchange-based claims that survived were those of plaintiffs who, "before the suppression period started, shorted contracts that were held to settlement during the suppression period," as they could "rely on an unmanipulated selling price as well as a settlement price demonstrably impacted by LIBOR suppression." Id. at *23.

Defendants point out that Plaintiff Dennis does not allege that he held any of his futures contracts to settlement. (1/6/17 Ltr. at 4.) Dennis also fails to allege sufficient detail about his transactions to explain how his damages could be calculated. (Id. ) This factor weighs against finding antitrust standing for Dennis. In addition, there is no direct relationship between Sterling LIBOR and the price of the products purchased by Plaintiffs Sonterra and Dennis, and Plaintiffs fail to allege sufficient details concerning how Defendants' alleged manipulation of Sterling LIBOR caused damages. Specifically, Plaintiffs state, in a conclusory fashion, that "[g]iven the mathematical and formulaic nature of the Sterling LIBOR and the Sterling LIBOR-based derivatives, the amount of injury to Plaintiffs and Class on each Sterling LIBOR-based derivative instrument may be mathematically ascertained and computed." (See CAC ¶ 114.) The CAC, however, does not contain any allegations that demonstrate how the amount of injury can be "mathematically ascertained and computed," and the allegations in the CAC are too vague to plausibly allege damages. Moreover, as discussed above, the price of the products purchased by Sonterra and Dennis was not determined based upon Sterling LIBOR; rather, Sterling LIBOR was part of a formula to calculate the cost of carrying Sterling over the duration of the foreign exchange forward or futures contract. (See id. ¶¶ 206, 212.)

iv. Duplicative Recovery and Complex Damage Apportionment

The final factor "reflects a 'strong interest in keeping the scope of complex antitrust trials within judicially manageable limits.' " LIBOR VI , 2016 WL 7378980, at *23 (quoting AGC , 459 U.S. at 543, 103 S.Ct. 897 ). It traditionally concerns "the prospect of different groups of plaintiffs attempting to recover for the same exact injury." Id. The Circuit in Gelboim expressed concern over the fact that the conduct at issue in that case was the subject of numerous government and regulatory investigations and cases, as well as ongoing proceedings in several other countries. 823 F.3d at 780. "Some of those government initiatives may seek damages on behalf of victims, and for apportionment among them. Others may seek fines, injunctions, disgorgement, and other remedies known to United States courts and foreign jurisdictions. It is wholly unclear on this record how issues of duplicate recovery and damage apportionment can be assessed." Id.

However, at this stage, "there has been no showing that certain plaintiffs have been made whole through the receipt of restitution payments made to governments." LIBOR VI , 2016 WL 7378980, at *23. The situation here is analogous to LIBOR VI . Should duplicate recoveries or apportionment issues become an issue in the future, any restitution payments would be considered to avoid duplicative recovery. Id. ; see also Sullivan , 2017 WL 685570, at *20 ("This Court also concludes that government enforcement actions have not been shown to risk duplicative recovery in this case.").

* * *

Based on the foregoing factors, I find that only Plaintiff FrontPoint has antitrust standing, and only with respect to its Sherman Act claims against Defendant UBS. Unlike Plaintiffs Dennis and Sonterra, FrontPoint transacted directly with UBS and can point to specific transactions on specific dates, which obviates concerns about damage calculations and speculative damages. The remaining claims involve transactions with non-defendant third-parties-whose "independent decision[s]" to incorporate Sterling LIBOR into their transactions "breaks the chain of causation between [D]efendants' actions and [Plaintiffs'] injury," LIBOR VI , 2016 WL 7378980, at *17 (internal quotation marks omitted)-and damages that are speculative.

2. The FTAIA

Defendants also argue that Plaintiffs' Sherman Act claims are barred by FTAIA, (Defs.' SMJ Br. 19-21), which provides that the Sherman Act:

shall not apply to conduct involving trade or commerce (other than import trade or import commerce) with foreign nations unless--

(1) such conduct has a direct, substantial, and reasonably foreseeable effect--

(A) on trade or commerce which is not trade or commerce with foreign nations, or on import trade or import commerce with foreign nations; or

(B) on export trade or export commerce with foreign nations, of a person engaged in such trade or commerce in the United States; and

(2) such effect gives rise to a claim under the provisions of sections 1 to 7 of this title, other than this section.

15 U.S.C. § 6a. "This technical language initially lays down a general rule placing all (nonimport) activity involving foreign commerce outside the Sherman Act's reach. It then brings such conduct back within the Sherman Act's reach provided that the conduct both (1) sufficiently affects American commerce, i.e. , it has a 'direct, substantial, and reasonably foreseeable effect' on American domestic, import, or (certain) export commerce, and (2) has an effect of a kind that antitrust law considers harmful, i.e. , the 'effect' must 'give rise to a Sherman Act claim.' " F. Hoffmann-La Roche Ltd. v. Empagran S.A. , 542 U.S. 155, 162, 124 S.Ct. 2359, 159 L.Ed.2d 226 (2004) (quoting §§ 6a(1), (2) ); accord Lotes Co. v. Hon Hai Precision Indus. Co. , 753 F.3d 395, 398 (2d Cir. 2014). "The FTAIA permits a plaintiff to bring Sherman Act claims 'involving trade or commerce with foreign nations,' provided that defendants' conduct has a 'reasonably proximate causal nexus' to an antitrust injury in the United States." Sullivan , 2017 WL 685570, at *21 (quoting Lotes , 753 F.3d at 405 ). "The requirements of the FTAIA go to the merits of an antitrust claim rather than to subject matter jurisdiction." Id.

Defendants argue that Plaintiffs fail to allege that the foreign conduct had a "reasonably proximate" effect within the United States. (Defs.' SMJ Br. 19-21.) I disagree. The foreign conduct alleged here easily falls within the FTAIA exception for having "adversely affect[ed] domestic commerce, imports to the United States, or exporting activities of one engaged in such activities within the United States." Precision Assocs., Inc. v. Panalpina World Transp., (Holding) Ltd. , No. CV-08-42 (JG)(VVP), 2013 WL 6481195, at *23 (E.D.N.Y. Sept. 20, 2013) (quoting F. Hoffmann-La Roche , 542 U.S. at 161, 124 S.Ct. 2359 ). The CAC alleges that Defendants manipulated Sterling LIBOR, which caused injury with regard to transactions carried out in financial instruments with prices influenced by that manipulated rate. Specifically, Plaintiffs allege that the financial instruments purchased by Plaintiffs-U.S. corporations and individuals-were priced, benchmarked, or settled based on Sterling LIBOR. This is the type of injury the Sherman Act is meant to address. See F. Hoffmann-La Roche , 542 U.S. at 165, 124 S.Ct. 2359 ("[O]ur courts have long held that application of our antitrust laws to foreign anticompetitive conduct is nonetheless reasonable, and hence consistent with principles of prescriptive comity, insofar as they reflect a legislative effort to redress domestic antitrust injury that foreign anticompetitive conduct has caused."); see also Sullivan , 2017 WL 685570, at *22 (holding that similar claims were not barred by FTAIA). Therefore, Plaintiffs have adequately alleged a domestic antitrust injury caused by Defendants' foreign anticompetitive conduct, and Defendants' motion to dismiss based on the FTAIA is therefore denied.

3. Antitrust Conspiracy

Plaintiffs' First Claim for Relief alleges that Defendants conspired to restrain trade by making false submissions to the BBA designed to artificially suppress, inflate, maintain, or otherwise alter Sterling LIBOR. (CAC ¶¶ 234-44.) The Second Claim for Relief alleges that Defendants conspired to manipulate derivative prices. (Id. ¶¶ 245-52.) Defendants argue that, for both claims, Plaintiffs fail to either (1) assert direct evidence that Defendants entered into an agreement in violation of the antitrust laws, or (2) present circumstantial facts supporting the inference that a conspiracy existed. (Defs.' SMJ Br. 21-25.)

a. Applicable Law

Section 1 of the Sherman Act makes unlawful "[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States." 15 U.S.C. § 1. "Price-fixing 'conspiracies concentrate the power to set prices among the conspirators, including the power to control the market and to fix arbitrary and unreasonable prices.' " Sullivan , 2017 WL 685570, at *23 (quoting United States v. Apple, Inc. , 791 F.3d 290, 326 (2d Cir. 2015) ). "[A]ny conspiracy 'formed for the purpose and with the effect of raising, depressing, fixing, pegging, or stabilizing the price of a commodity is illegal per se,' and the precise 'machinery employed is immaterial.' " Apple , 791 F.3d at 327 (quoting United States v. Socony-Vacuum Oil Co. , 310 U.S. 150, 223, 60 S.Ct. 811, 84 L.Ed. 1129 (1940) ).

At the pleading stage, a plaintiff "need not show that its allegations suggesting an agreement are more likely than not true or that they rule out the possibility of independent action, as would be required at later litigation stages such as a defense motion for summary judgment, or a trial." Anderson News, L.L.C. v. Am. Media, Inc. , 680 F.3d 162, 184 (2d Cir. 2012) (citations omitted). "Rather, 'because plausibility is a standard lower than probability, a given set of actions may well be subject to diverging interpretations, each of which is plausible.' The choice between two plausible inferences that may be drawn from factual allegations is not a choice to be made by the court on a Rule 12(b)(6) motion." Gelboim , 823 F.3d at 781 (quoting Anderson News , 680 F.3d at 184-85 ). "Skepticism of a conspiracy's existence is insufficient to warrant dismissal; 'a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely.' " Id. (quoting Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ).

To establish a Section 1 conspiracy, "proof of joint or concerted action is required; proof of unilateral action does not suffice." Gelboim , 823 F.3d at 781 (quoting Anderson News , 680 F.3d at 183 ). "Circumstances must reveal a unity of purpose or a common design and understanding, or a meeting of minds in an unlawful arrangement." Id. Mere "parallel conduct" does not suffice. Id. Because "conspiracies are rarely evidenced by explicit agreements," however, a conspiracy "nearly always must be proven through inferences that may fairly be drawn from the behavior of the alleged conspirators." Id. "The line separating conspiracy from parallelism is indistinct, but may be crossed with allegations of interdependent conduct, accompanied by circumstantial evidence and plus factors." Id. (internal quotation marks omitted). Those illustrative, non-exhaustive "plus factors" are "(1) a common motive to conspire; (2) evidence that shows that the parallel acts were against the apparent individual economic self-interest of the alleged conspirators; and (3) evidence of a high level of interfirm communications." Id. (internal quotation marks omitted). "[A]t the motion-to-dismiss stage, appellants must only put forth sufficient factual matter to plausibly suggest an inference of conspiracy, even if the facts are susceptible to an equally likely interpretation." Id. at 782 (citation omitted).

b. Application

With these principles in mind, I find that Plaintiffs adequately allege an antitrust conspiracy. The CAC alleges that Defendants collusively shared information to coordinate their Sterling LIBOR submissions and engaged in manipulative trading practices to fix the prices of Sterling LIBOR-based derivatives for their collective financial benefit. (CAC ¶ 125.) It alleges that collusive communications occurred "among Sterling LIBOR-based derivative traders and submitters located at different, supposedly competing, Sterling LIBOR contributor banks," and in messages "relayed between Defendants by various ... inter-dealer brokers." (Id. ¶ 127.) With respect to UBS, Plaintiffs rely on regulatory settlements between them and the DOJ, CFTC, and other regulators, which brought charges against UBS for LIBOR manipulation. (Id. ¶¶ 5, 11-12.) The settlements describe collusive conduct intended to manipulate the LIBOR. (See id. ¶¶ 17-19, 120(e).)

For instance, Plaintiffs cite to UBS's non-prosecution agreement with DOJ, in which UBS admitted to manipulating and colluding to manipulate with other Contributor Panel banks LIBOR submissions with respect to other currencies. (CAC ¶¶ 17-19; see also UBS DOJ SOF at ¶¶ 21-22 (describing conduct as to Yen LIBOR and Euroyen TIBOR).) With respect to Sterling, UBS communicated internally with its Sterling derivatives traders to manipulate the Sterling LIBOR. (CAC ¶¶ 17-19; UBS DOJ SOF at ¶¶ 77-82.) Plaintiffs also point to the CFTC's findings that

UBS made knowingly false submissions to rate-fixing panels to benefit its derivatives trading positions or the derivatives trading positions of other banks in attempts to manipulate Yen, Swiss Franc, Sterling and Euro LIBOR and Euribor, and, periodically, Euroyen TIBOR.

(CAC ¶ 120(e) ) (quoting UBS CFTC Agmt. at 2); see also UBS CFTC Agmt. at 2 ("UBS, through certain derivatives traders, also colluded with traders at other banks and coordinated with interdealer brokers in its attempts to manipulate Yen LIBOR and Euroyen TIBOR.")

Defendants argue that Plaintiffs have not alleged any communication between or among the Defendants regarding Sterling LIBOR to support their conspiracy claim, and instead only point to intrafirm communications. However, while direct communications among conspirators are relevant, they are not necessary. Accordingly, Defendants' motion to dismiss for failure to allege an antitrust conspiracy is denied.

C. Commodity Exchange Act (CEA)

The CAC assert three causes of action of under the CEA. (CAC ¶¶ 253-64.) However, Plaintiffs Sonterra and FrontPoint abandoned their claims under the CEA, (Pls.' SMJ Opp. 32 n.24); therefore, I only address Plaintiff Dennis's claims under the CEA. Defendants argue that Dennis (1) lacks standing to pursue his claims and (2) fails to adequately allege specific intent to manipulate the price of Sterling FX Futures. (Defs.' SMJ Br. 31-45.)

1. Applicable Law

The CEA prohibits any person from "manipulat[ing] or attempt[ing] to manipulate the price of any commodity in interstate commerce." 7 U.S.C. § 13(a)(2) ; see also In re Amaranth Nat. Gas Commodities Litig. , 730 F.3d 170, 173 (2d Cir. 2013). "While the CEA itself does not define the term, a court will find manipulation where '(1) Defendants possessed an ability to influence market prices; (2) an artificial price existed; (3) Defendants caused the artificial prices; and (4) Defendants specifically intended to cause the artificial price.' " Id. at 173 (quoting Hershey v. Energy Transfer Partners, L.P. , 610 F.3d 239, 247 (5th Cir. 2010) ).

To plead the element of specific intent, also known as scienter, a plaintiff must allege that defendants "acted (or failed to act) with the purpose or conscious object of causing or effecting a price or price trend in the market that did not reflect the legitimate forces of supply and demand." Platinum , 2017 WL 1169626, at *32 (quoting U.S. Commodity Futures Trading Comm'n v. Wilson , 27 F.Supp.3d 517, 532 (S.D.N.Y. 2014) ). It is insufficient to show a mere "generalized intent to obtain trading profits 'which could be imputed to any corporation with a large market presence in any commodity market.' " Wilson , 27 F.Supp.3d at 532-33 (quoting In re Crude Oil Commodity Litig. , No. 06 CIV. 6677, 2007 WL 1946553, at *8 (S.D.N.Y. June 28, 2007) ). To establish "specific intent to cause a market distortion," a plaintiff can allege facts either "(1) showing that the defendants had both motive and opportunity to commit the fraud or (2) constituting strong circumstantial evidence of conscious misbehavior or recklessness." Platinum , 2017 WL 1169626, at *32 (quoting In re Amaranth Nat. Gas Commodities Litig. , 587 F.Supp.2d 513, 530 (S.D.N.Y. 2008) ). The factual allegations in the complaint must "give rise to a strong inference of scienter." LIBOR III , 27 F.Supp.3d at 468 (internal quotation marks omitted).

2. Application

a. CEA Standing

Section 22(a)(1) of the CEA creates an exclusive private right of action "available to any person who sustains loss as a result of any alleged violation" of the CEA. 7 U.S.C. § 25(a)(2). "To have standing under Section 22, a private plaintiff must fall into one of four categories" set forth in Section 22(a)(1). Loginovskaya v. Batratchenko , 936 F.Supp.2d 357, 365 (S.D.N.Y. 2013), aff'd , 764 F.3d 266 (2d Cir. 2014). Plaintiff Dennis invokes Section 22(a)(1)(D) of the CEA, which conveys standing to any person "who purchased or sold a [futures contract] or swap if the violation constitutes ... (ii) a manipulation of the price of any such contract." 7 U.S.C. § 25(a)(1)(D) ; see Platinum , 2017 WL 1169626, at *28. He argues that Defendants manipulated the prices of his Sterling futures contracts. (Pls.' SMJ Opp. 32.)

Defendants argue that Plaintiff Dennis lacks standing because he fails to plausibly allege that Defendants manipulated the prices of his FX Futures contracts because their prices are not pegged to Sterling LIBOR. (Defs.' SMJ Br. 39.) This is essentially the same argument as discussed above in the context of antitrust standing-that there is no plausible relationship between Dennis's FX Futures and the alleged Sterling LIBOR manipulation to adequately allege an injury. Thus, for the reasons stated above, supra Part V.B.1.b, I find that Dennis has adequately pled that the Sterling LIBOR manipulation had an effect on futures contracts for the purposes of CEA standing. A CME futures contract is an agreement to buy or sell £62,500, in U.S. Dollars, on some future date. (CAC ¶ 212.) The cost of buying or selling Sterling on that future date is determined by a formula that incorporates Sterling LIBOR to adjust the spot price of Sterling to account for the amount of interest paid or received over the duration of the agreement. (Id. ) A change in the Sterling LIBOR thus affects the price of the contract, at least for the purpose of CEA standing.

Defendants also argue that Dennis lacks standing under the CEA because he has not pled actual damages, a requirement for CEA standing. (Defs.' SMJ Br. 40-42.) "As several courts in this district have held, however, where plaintiffs allege that they transacted 'at artificial prices, injury may be presumed.' " Platinum , 2017 WL 1169626, at *28 (quoting In re Amaranth Nat. Gas Commodities Litig. , 269 F.R.D. 366, 380 (S.D.N.Y. 2010) ); see also In re Crude Oil Commodity Futures Litig. , 913 F.Supp.2d 41, 59-61 (S.D.N.Y. 2012). Therefore, I find that Dennis has adequately pled actual damages for standing under the CEA.

In addition, Defendants argue that Dennis lacks standing because he pleads only one specific futures transaction on two dates during the Class Period, but does not allege that Sterling LIBOR was artificial on those dates. (Defs.' SMJ Reply 18.) They rely on LIBOR II , in which Judge Buchwald held that certain plaintiffs had failed to allege the requisite actual damages by failing to plead that they transacted in Eurodollar futures contracts on days in which the prices of such contracts were artificial as a result of trader-based manipulation of the LIBOR. See LIBOR II , 962 F.Supp.2d at 620-21. However, Judge Buchwald expressly distinguished between plaintiffs' "trader-based manipulation theory" and their "persistent suppression theory," the latter of which did not require plaintiffs to plead a connection between specific trading days and days of LIBOR manipulation. Id. at 621-22 ; see also Platinum , 2017 WL 1169626, at *29 (discussing LIBOR II 's distinction between trader-based manipulation and persistent suppression). Dennis alleges just such a "persistent suppression theory." The CAC alleges that Dennis engaged in U.S.-based transactions for CME British pound futures contracts during the period in which Defendants were engaged in their ongoing scheme. (CAC ¶ 214.) The allegations that Defendants' persistent conduct rendered the Sterling LIBOR artificial throughout the Class Period is sufficient to plausibly allege that Dennis's damages were caused by the alleged Sterling LIBOR manipulation. See Platinum , 2017 WL 1169626, at *29; LIBOR II , 962 F.Supp.2d at 621-22.

Accordingly, Dennis has standing to pursue his CEA claims. However, Dennis must still overcome an additional hurdle to pursue his claims: the element of specific intent.

b. Specific Intent

With regard to specific intent, Dennis pleads no facts indicating, much less giving rise to a "strong inference," LIBOR III , 27 F.Supp.3d at 468, that Defendants' conduct with respect to Sterling LIBOR was intended to manipulate the prices of any particular financial instrument at issue in this case. Plaintiffs' generalized contention that "Defendants, as some of the largest dealers in the Sterling LIBOR-based derivatives market, all shared a common motive to increase profits through manipulation," (Pls.' SMJ Opp. 35), offers no basis to draw a "strong inference" of intent to manipulate Sterling FX Futures contracts-instruments that are not even tied to the benchmark Defendants allegedly manipulated. See Hershey , 610 F.3d at 249 (no specific intent where effect on certain futures contracts was "merely an unintended consequence of the Defendants' manipulative trading"). Indeed, "[s]uch a generalized motive, one which could be imputed to any corporation with a large market presence in any commodity market, is insufficient to show intent." In re Crude Oil Commodity Litig. , 2007 WL 1946553, at *8.

Nor do Plaintiffs adequately allege conscious misbehavior or recklessness with respect to the price of Dennis's FX Futures. Plaintiffs point to the various Government settlements as evidence of purported conscious misbehavior or reckless. Nothing in Defendants' settlements with regulators, however, reflects any intent by any Defendant to cause artificial pricing of the financial instruments purchased by Dennis in particular (as opposed to Sterling LIBOR in general). In In re Commodity Exchange, Inc., Silver Futures & Options Trading Litigation , the court emphasized that the complaint lacked "reference to specific communications between the defendants about any specific plan to cause artificial prices or an artificial price trend in the silver futures market." No. 11 Md. 2213(RPP), 2012 WL 6700236, at *11 (S.D.N.Y. Dec. 21, 2012). The same is true here as to the Sterling FX forwards, futures, and interest swaps markets. Accordingly, the CAC fails to adequately allege specific intent on the part of Defendants, and Plaintiff Dennis's CEA claim is dismissed.

Plaintiff Dennis's principal-agent liability and aiding and abetting claims under the CEA must also fail. Both types of claims are viable only where an underlying primary violation of the CEA can survive a motion to dismiss. See In re Commodity Exch., Inc. Silver Futures & Options Trading Litig. , 560 F. App'x 84, 87 (2d Cir. 2014) (summary order) ("As plaintiffs failed to allege a CEA violation, their aiding and abetting claim was properly dismissed as well."); In re Amaranth Nat. Gas Commodities Litig. , 730 F.3d at 183 ("[A]iding and abetting requires knowledge of the primary violation and an intent to assist it...."). Plaintiff Dennis fails to allege a primary CEA violation for the reasons discussed above, so his principal-agent liability and aiding and abetting claims must be dismissed as well.

D. RICO

The CAC also asserts claims under RICO. Defendants argue that (1) Plaintiffs lack RICO standing, (2) the claims are impermissibly extraterritorial, and (3) Plaintiffs fail to plead the elements of a RICO violation or conspiracy. (Defs.' SMJ Br. 46-52.) I agree with Defendants that Plaintiffs fail to overcome the presumption against extraterritoriality; therefore, I do not reach Defendants' remaining arguments.

1. Applicable Law

RICO makes it "unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." 18 U.S.