New York Times, WASHINGTON, June 18 — The Supreme Court ruled in favor of more than a dozen Wall Street investment banks today as it found that they could not be sued under antitrust law over losses in the crash of technology stocks seven years ago.
By a 7-to-1 majority, the court held that securities law, not antitrust law, applies to the conduct that the dissatisfied stock buyers alleged in the case. They complained in part that the investment banks conspired to drive up prices on hundreds of new stocks.
Today’s ruling overturns a 2005 decision by the United States Court of Appeals for the Second Circuit, in Manhattan, which said it found “dangerous manipulation” by the banks and would have allowed the plaintiffs to proceed under antitrust law.
The case had been closely watched on Wall Street, in part because a successful suit under antitrust law could lead to triple damages, unlike penalties under securities laws.