Conspiracy Case Against Private Equity Firms May Go Forward

A class action, Kirk Dahl et al v. Bain Capital Partners, filed against major private equity firms, including JP Morgan, Goldman Sachs, Blackstone, alleges that the companies conspired to lower the prices of private equity deals.  The defendants moved to dismiss on two grounds: 1) that the claim was a disguished securities claim pre-empted by the securities laws; and 2) that the plaintiffs insufficiently alleged a conspiracy under Twombly.  Judge Edward Harrington, US District Court for the District of Massachusetts, held that the claim was not pre-empted because the securities laws do not apply to private equity deals and that the plaintiffs pointed to nine transactions that plausibly suggest an illegal agreement existed.

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