Ten of the world’s largest investment banks have won the latest round in a long-running dispute over alleged price-rigging in the United States corporate bond market after a federal judge threw out an investor lawsuit in New York.

US district judge Valerie Caproni dismissed the proposed class action with prejudice, finding that plaintiffs failed to show the banks conspired to inflate spreads on so-called odd-lot trades, which account for the bulk of secondary bond transactions. The claim accused Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan Chase, Morgan Stanley, NatWest and Wells Fargo of overcharging customers by billions of dollars since 2006.

Although the institutions together underwrite about 65 per cent of new issues and handle roughly 90 per cent of trading volume, the court said market share alone did not prove control of secondary prices. “It does not follow that defendants have the power to control pricing of the bonds in the secondary market,” judge Caproni wrote in her decision.

Investors alleged the banks ran the Bond Desk, Trading Edge and Tradeweb platforms as a “catch-and-kill” scheme, while boycotting rival venues that offered fairer pricing. Caproni ruled there were no overt acts within the four years before the case was filed in April 2020 to support claims of a continuing conspiracy under the Sherman Act.

The lawsuit has travelled a complex path through the federal courts. It was first dismissed in 2021 by judge Lewis Liman, whose wife later revealed a holding in Bank of America. Although the second circuit court of appeals reinstated the complaint last year on impartiality grounds, the new judge concluded evidence still fell short of establishing collusion. Her order bars the plaintiffs from refiling.

Legal representatives for the investor group did not immediately respond to requests for comment, Reuters reported. Several defendant banks also declined to comment on the outcome.

The decision closes, at least for now, one of several high-profile antitrust challenges to global financial institutions in recent years. Similar claims concerning foreign-exchange and interest-rate benchmarks have resulted in multi-billion-dollar settlements, but the bond-pricing allegations failed to clear the evidentiary bar set by the Manhattan court.

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