The United States Supreme Court issued an order on April 20, 2026, denying petitions for certiorari from JPMorgan Chase & Co. and Bank of America Corp., effectively allowing a major class action lawsuit to proceed in federal court. The litigation centers on allegations that the two financial institutions conspired to artificially inflate interest rates on state and municipal bonds. This practice, according to the plaintiffs, resulted in significantly higher borrowing costs for local governments and public agencies across the country.
The case involves a class of plaintiffs that includes various state treasuries, municipal governments, and public entities that issued debt during the period of the alleged misconduct. According to court filings, the banks are accused of violating the Sherman Antitrust Act by coordinating bids and sharing non-public pricing information during the issuance of municipal securities. The plaintiffs argue that this collusion suppressed competitive bidding processes, leading to interest rates that were higher than those that would have been established in a transparent and competitive market.
The financial stakes of the litigation are substantial. Legal documentation and preliminary assessments from the plaintiffs' counsel suggest that the banks could face a combined settlement and damages total of approximately $770 million. This figure accounts for the estimated excess interest paid by the affected municipalities, as well as statutory penalties and interest accrued over the duration of the legal proceedings. Both JPMorgan Chase and Bank of America had previously moved to dismiss the case, contending that the plaintiffs failed to provide specific evidence of a bilateral agreement to fix prices and that the claims were filed outside the applicable statute of limitations.
The Supreme Court's decision to let the lower court's ruling stand follows a 2025 decision by the U.S. Court of Appeals for the Second Circuit, which found that the plaintiffs had presented sufficient factual allegations to move the case into the discovery phase. By declining to hear the banks' appeals, the Supreme Court has removed the final legal hurdle preventing the case from moving toward a trial or a comprehensive settlement agreement. The matter will now return to the U.S. District Court for the Southern District of New York for further proceedings.
Representatives for JPMorgan Chase and Bank of America have consistently denied the allegations of rate manipulation, stating that their municipal bond desks operate in compliance with all federal and state regulations. Following the court's announcement, a spokesperson for the lead plaintiffs' firm stated that the ruling is a significant step toward recovering funds for taxpayers and public infrastructure projects. The litigation is docketed as City of Philadelphia v. JPMorgan Chase & Co., et al., and remains one of the largest pending antitrust cases in the municipal finance sector.