Major banks insist communication with DOJ over FX fines calculation was “principally oral”
Barclays, Citi, JPMorgan Chase, NatWest Markets and UBS, which stand accused of conspiring to fix prices of FX benchmark rates in violation of Section 1 of the Sherman Antitrust Act, 15 U.S.C. sec. 1 et seq. in a civil lawsuit brought in the New York Southern District Court, have provided their stance on the nature of their communications with the US authorities over fines issued to them back in 2015.
The banks are defendants in a case launched by a putative class of consumers and end-user businesses that allege they paid inflated Forex rates caused by an alleged conspiracy among the defendant banks.
On October 19, 2020, Barclays, Citi, JPMorgan Chase, NatWest Markets and UBS filed a document with the Court responding to a letter by the plaintiffs regarding discovery issues. The problem at the heart of discussions at this point concerns the methodology for the calculation of the FX fines back in 2015 and the relevant communications with the DOJ.
Whereas the plaintiffs insist they are entitled to get access to all such communications, the defendant banks say some of the requested materials cannot be produced.
According to the banks, where applicable, defendants have already produced the documents they provided to DOJ that DOJ may have considered as part of its calculations of FX fix order volume or market shares. Furthermore, DOJ explained the methodology it used to calculate the FX fines in the sentencing memoranda publicly filed in the related criminal case, and defendants have produced copies of those memoranda to plaintiffs.
In addition, defendants’ interrogatory responses provided substantive descriptions of oral communications they had with DOJ about FX fine calculation issues, including communications where DOJ initially mentioned the methodology it planned to use and defendants responded. And the three defendants (Citi, JPMorgan, and RBS) that sent responsive written communications to DOJ have provided the relevant communications.
To the extent there are other documents in defendants’ possession reflecting communications with DOJ about DOJ’s methodology, those documents are protected by the work product doctrine, the banks say.
“Defendants’ communications with DOJ about plea agreement fine calculation issues were principally (and for some defendants, entirely) oral, occurring in telephone conversations and in-person meetings. In certain instances, counsel prepared internal memos and engaged in email correspondence internally or with their clients concerning these calls and meetings”.
In addition, according to the banks, the information in question is of marginal relevance. The plea agreement fine calculations were based on transactions in the spot FX market, and had nothing to do with the retail branch physical foreign currency exchange market that defines plaintiffs’ proposed class and is at issue in this case, the defendants say.
Also, because the requested materials include opinion work product in the form of attorney mental impressions, plaintiffs would need to make a “far stronger showing of necessity and unavailability of other means.” Counsel’s notes of a communication are opinion work product entitled to heightened protection where they contain “summaries of what [counsel] deemed to be the key areas discussed,” the banks conclude.
As FX News Group has reported, the plaintiffs in this case have already locked horns with UBS AG over the production of materials related to the communications with the DOJ about the fines.