* Barclays, ScotiaBank, HSBC, Societe Generale face claims
* Deutsche Bank settlement agreement expected
* Banks accused of suppressing, exploiting gold prices
By Jonathan Stempel
NEW YORK, Oct 5 A U.S. judge said gold investors
may pursue much of their lawsuit accusing four major banks of
conspiring for a decade to fix prices and exploit distortions at
the expense of investors in global markets for the precious
Antitrust and manipulation claims can move forward against
Barclays Plc, Bank of Nova Scotia ("ScotiaBank")
, HSBC Holdings Plc and Societe Generale
, U.S. District Judge Valerie Caproni in Manhattan said
in a decision made public on Tuesday.
Investors allege that the banks conspired from 2004 to 2013
to fix prices. They did not estimate the size of the banks' gold
portfolios, but said the gold derivatives market alone was as
large as $650 billion during the class period.
"From the gold plaintiffs' standpoint, it's a very
substantial victory," Dan Brockett, a partner at Quinn Emanuel
Urquhart & Sullivan representing the investors, said in a phone
interview on Wednesday.
Deutsche Bank AG settled related claims in April,
and the investors plan to seek preliminary approval of a
settlement, Brockett said.
Terms have not been disclosed, but Deutsche Bank has put the
expected payment in escrow, he said.
In a separate case involving the silver market, Caproni said
another group of investors may pursue market rigging claims
against ScotiaBank and HSBC.
Both decisions dismissed UBS Group AG as a
defendant, saying there was nothing showing it manipulated
prices, even if it benefited from market distortions.
Barclays spokesman Andrew Smith, ScotiaBank spokesman Rick
Roth, Societe Generale spokesman Jim Galvin and Deutsche Bank
spokeswoman Amanda Williams declined to comment. UBS spokeswoman
Erica Chase said the bank is pleased with the decisions. HSBC
had no immediate comment.
Investors have several lawsuits before the Manhattan court
accusing banks of conspiring to rig rates and prices in
financial and commodities markets.
In the gold case, investors said Barclays, Deutsche Bank,
HSBC, ScotiaBank and Societe Generale conspired to manipulate
prices of gold, gold futures and options, and gold derivatives
through twice-a-day meetings to set the London Gold Fixing.
The investors said this conspiracy let the banks suppress
prices and reduce risk at other investors' expense.
In her 73-page decision, Caproni said the investors
plausibly alleged that the five banks recklessly created
"artificial price dynamics" for gold, and that their misconduct
was the "proximate cause" of the distortions.
She let the investors pursue antitrust claims for alleged
unlawful restraint of trade from January 2006 to December 2012.
The judge dismissed a claim for unjust enrichment.
Caproni gave the investors 14 days to amend their complaint.
The case is In re: Commodity Exchange Inc Gold Futures and
Options Trading Litigation, U.S. District Court, Southern
District of New York, No. 14-mc-02548.
(Reporting by Jonathan Stempel in New York; Editing by David