Supreme Court lets cities pursue $12 billion bank antitrust class action

The Supreme Court left cities and transit agencies on track to pursue a sweeping antitrust case accusing eight major banks of colluding to push up borrowing costs in the municipal-bond market, a dispute that could ultimately affect what taxpayers pay for schools, hospitals and water systems.

By declining to hear the banks’ appeal, the justices left intact a class-certification ruling that lets Philadelphia, Baltimore and the San Diego Association of Governments proceed together in City of Philadelphia et al. v. Bank of America Corporation et al. The case is being overseen by U.S. District Judge Jesse M. Furman in the Southern District of New York and targets Bank of America, Barclays, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Royal Bank of Canada and Wells Fargo.

The plaintiffs say the banks manipulated rates on variable-rate demand obligations, or VRDOs, which are long-term municipal bonds with rates that reset daily or weekly. They allege the conduct ran from February 1, 2008, through November 30, 2015, and that it affected thousands of bonds used to finance public projects across the country. The cities say higher financing costs meant less money for essential services and infrastructure, including hospitals, power and water systems, schools and transportation.

The dispute has become one of the largest municipal-bond antitrust cases to emerge from the post-financial-crisis era. A law-firm analysis has said the class seeks more than $4 billion before antitrust trebling, a figure that is often described as roughly $12 billion after trebling. The banks have denied wrongdoing and argued that the case should not be treated as a class action because damages should be proven city by city, with bond-specific factors examined separately.

That argument lost in the district court when Furman certified the class on September 21, 2023. The U.S. Court of Appeals for the Second Circuit unanimously affirmed on August 1, 2025, keeping the class intact before the Supreme Court’s refusal to intervene on April 20, 2026. The high court gave no explanation, leaving the lower-court ruling in place without reaching the merits.

The practical effect is significant. Class certification gives the municipalities a stronger negotiating position and keeps alive a case built around a broader market claim: that alleged coordination in a key corner of public finance translated into more expensive borrowing for local governments. If the plaintiffs prove their allegations, the financial cost could ripple far beyond Wall Street and into the next round of public projects financed by cities, schools and transit agencies.