# In re Interest Rate Swaps Antitrust Litigation

> District Court, S.D. New York · July 28, 2017 · 261 F. Supp. 3d 430

URL: https://www.frixlaw.com/law-library/cases/7244183

## Case

- **Full name:** IN RE: INTEREST RATE SWAPS ANTITRUST LITIGATION This Document Relates to AH Actions
- **Court:** District Court, S.D. New York
- **Decided:** July 28, 2017
- **Citations:** 261 F. Supp. 3d 430
- **Precedential status:** Published
- **Opinion:** Opinion of the court by Engelmayer
- **Judges:** Engelmayer
- **Cited by:** 23 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/7244183

## How later opinions describe it (automated extraction)

- holding, on motion to dismiss plaintiffs' earlier complaints, that certain materials on which defendants relied to demonstrate "market realities" in ostensible tension with plaintiffs' claims were not cognizable for the truth of the matter asserted on a motion to dismiss
- concluding that the plaintiffs’ focus on profitability was “myopic,” where, as here, the “overarching allegation is that preventing the all-to-all . . . trading platform[] from taking root enriched the [defendants] by preserving their wider spreads and profit margins”
- holding that the "mere opportunity to conspire at legitimate meetings does not support an inference" of an agreement to enter into an illegal conspiracy (quotation marks omitted)
- concluding that the plaintiffs were “[a]t a minimum . . . on inquiry notice” where the plaintiffs “had every basis, in real time, to smell a rat”

## Opinion text

*441 OPINION & ORDER
Paul A. Engelmayer, United States District Judge
This multi-district litigation involves claims, brought primarily under the antitrust laws, of unlawful collusion by investment banks who were dealers in the market for interest rate -swaps (“IRS” or “IRSs”). There are two groups of plaintiffs. The first consists of a putative class of investors who bought and sold IRSs between January 2008 and December 2016. They claim to have been subject to unfavorable pricing as a result of collusive actions among IRS dealers that impeded the development and later the survival of certain electronic exchange-based platforms for IRS trades. The second consists of a pair of companies, Javelin Capital Markets, LLC (“Javelin”) and Tera Group, Inc. (“Tera”) (together, “Javelin/Tera”). They claim that such dealers conspired to boycott and otherwise undermine the trading platforms that each developed and put in place by 2013 or 2014, which would have supplied investors with more competitive IRS prices. Plaintiffs sue 13 corporate entities and their affiliates: 11 investment banks that functioned as IRS dealers (the “Dealers” or “Dealer Defendants”) 1 ; one *442 broker of IRS trades, ICAP Capital Markets, LLC (“ICAP”); and one provider of electronic trading services for IRSs, Tra-deweb Markets LLC (“Tradeweb”).
.Pending are defendants’ motions, under Federal Rule of Civil Procedure 12(b)(6), to dismiss , plaintiffs’ claims. For the reasons that follow,-these motions are granted in part and denied in part.
1. Factual Background
The following facts are drawn from the Second Consolidated Amended Class Action Complaint (“SAC”), Dkt. 142 in No. 16-MD-2704, and Javelin/Tera’s Second Consolidated Amended Complaint (“JTSAC”), Dkt. 145 in No. 16-MD-2704 (together, the “SACs”). In resolving the motions to dismiss, the Court assumes all well-pleaded facts to be .true, and draws all reasonable inferences in favor of the plaintiffs. See Koch v. Christie’s Int’l PLC, 699 F.3d 141, 145 (2d Cir. 2012). 2
An important preface to the long factual allegations that follow is that the IRS market underwent major changes during the period (2007-2016) covered by the alleged conspiracy. The infrastructure necessary to support the electronic trading platforms which the investor plaintiffs- claim were denied them as a result of defendants’ collusion—platforms enabling anonymous “all-to-all” exchangé trading of IRSs— evolved. There was also a major regulatory development: the Dodd-Frank statute, passed July 21, 2010 in response to the 2008 financial crisis. Dodd-Frank’s mandates, as implemented by ensuing regulations, reshaped the IRS market. They facilitated the emergence, in 2013-2014, of electronic “all to all” platforms for anonymous IRS trading, like those of Javelin and Tera, accessible to investors.
In considering plaintiffs’ claims, it is, thérefore, important to focus on the distinct goal, at each point, of the' alleged conspiracy. Through 2012, plaintiffs allege concerted action among the Dealer Defendants and others to inhibit the emergence of electronic trading platforms accessible to investors that threatened to erode the Dealers’ profit margins on IRS trades. From 2013 on, after such platforms emerged, plaintiffs allege a boycott aimed at destroying three such new platforms, including Javelin’s and Tera’s.
A. Interest Rate Swaps
An IRS' is a financial derivative. It permits two parties to trade interest-rate-based cash flows op a specific amount of money over a fixed time period. Typically, *443 one party to an IRS pays cash flows based on a fixed interest rate, while the counter-party pays cash flows based on a floating interest rate, keyed to a benchmark or reference point such as the London Inters bank Offered Rate, or “LIBOR.” For example, a party might agree to pay a fixed interest rate on a $10 million notional amount for 10 years in exchange for the other party paying a floating rate (such as one tied to LIBOR) for that same 10-year period. The party paying a fixed rate is typically referred to as the “buyer,” and the party making payments at the floating rate is known as the “seller.” The value of the contract to each side moves (in opposite directions) depending on changes in interest i’ates. SAC ¶¶ 1-2; JTSAC ¶ 2.
IRSs are used,by an array of investors to manage risk and protect themselves against fluctuating interest rates. For example, a municipality that issued a floating rate bond to pay for a clean-water project might later use an IRS to convert floating-rate payments on the bond into fixed payments, so as to hedge against interest-rate increases. Investors in interest-rate swaps include pension funds, asset managers, endowment funds, corporations, insurance companies, municipalities, and ■ hedge funds. The IRS market has grown exponentially over the last three decades, with billions of dollars in notional quantity traded daily. In 2006, the outstanding notional quantity of IRSs was approximately $230 trillion; By 2014, it was approximately $381 trillion. SAC ¶¶ 3, 72; JTSAC ¶ 3.
B. The Evolution of IRS Trading Practices and Platforms
1. Early Years to 2013
In the early years of IRS trading, IRS contracts were not standardized. They typically were negotiated and documented on a trade,-by-trade basis, imposing high transaction costs. Over time, IRS trading became more standardized. In 1987, the International Swaps and Derivatives Association (“ISDA”) created the ISDA Master Agreement. It set out standardized terms to govern over-the-counter (“OTC”) derivatives transactions, and became widely used. By 2000, the material terms of most IRSs were standardized. These included the tenor (the maturity or term of the swap), the fixed rate, the reference index used to calculate floating payment, the payment frequency, and the timing of payments. This resulted in lower trading costs and higher trading volumes. SAC ¶¶ 70-71; JTSAC ¶¶ 67-68.
As demand for IRSs spread, the investment banks who dealt in interest swaps positioned themselves’ as the exclusive market makers or liquidity providers in the IRS market. As market makers, these banks became the sellers of IRSs (the “sell side”), offering fixed and floating-rate cash flows to their customers (the “buy side”). In this role, these Dealer Defendants profited from the “spread” between the “bid” and the “ask” for IRSs. The “bid” and the “ask” were typically set as follows: Because the floating rate is usually keyed to LIBOR, the key variable that is negotiated when entering into an IRS is generally the fixed rate that will be paid. A buy-side customer that seeks to pay the floating rate and to receive the" fixed rate will receive the “bid” price quoted by a dealer for the fixed rate; a buy-side customer that seeks to pay the fixed rate and to receive the floating rate will pay the “ask” or “offer” price quoted by a dealer for the fixed rate. For example, a dealer’s “bid” to pay the customer a fixed rate on a five-year IRS might be 2.00% whereas its “ask” as to the fixed rate it would receive from the customer for the same IRS might be 2.05%. The wider the spread between the bid and ask prices quoted by the dealer, the more profit the dealer will make from its IRS line of business. SAC ¶¶ 73-75; JTSAC ¶¶ 70-73.
*444 Historically, dealers and their buy-side customers communicated almost exclusively over the counter (“OTC”), by telephone. This means of IRS trading was advantageous to dealers. In practice, it meant that customers received real-time pricing information from only the dealer, or at most from a small number of dealers, because contacting many dealers for price information was-logistically unrealistic and costly. Dealers were also advantaged, because, to obtain a price quote, the customer was required to disclose to the dealer its identity and the direction and notional amount of the trade it sought to make. Dealers could use this “one-way flow of information” about upcoming trades to their trading advantage. Dealers also often required customers to execute trades “on the wire,” meaning during the phone call, or else the price quote might lapse; or to disclose whether the customer' was putting one dealer “in competition” with other dealers. These practices, too, tended to diminish price competition. SAC ¶¶ 76-78; JTSAC ¶¶ 74-76.
Electronic trading in fixed income securities was introduced in the mid-1990s. It gained momentum in the IRS market in the early 2000s. Such trading had potential to make IRS trading more efficient, transparent and competitive. But, plaintiffs allege, electronic trading developed asymmetrically. With respect to trading between dealers, the dealers utilized electronic platforms operated by entities known as inter-dealer brokers (“IDBs”). These platforms allowed dealers to access better and transparent pricing for themselves, and speedier execution, while they responded to buy-side requests to trade. A dealer using an IDB submits its bid and ask prices to the IDB, which then publicizes the best quotes (known as the “inside market”) anonymously to all other dealers in the platform. A dealer can immediately enter into an IRS contract at a quoted price without negotiations, or it can ask the IDB to attempt to negotiate a better price. As to standardized IRS products that are actively traded, an IDBs uses electronic trading platforms akin to electronic “order books,” which automatically match the best bids and offers. In return for facilitating dealer-to-dealer trades, an IDB earns a commission, known as a “brokerage fee,” on each trade. But, ^plaintiffs allege, the IDBs allowed only dealer-to-dealer transactions. Plaintiffs allege, for example, that defendant ICAP, the leading IDB for IRSs, did not open its interdealer platform to buy-side customers. SAC ¶¶ 10-13, 84—86; JTSAC ¶¶ 81-83.
In contrast, plaintiffs allege, until 2013, the only IRS electronic trading platforms that developed that were open to buy-side customers typically used a “request-for-quotes” (“RFQ”) protocol. In it, a buy-side customer, via electronic messages, can request quotes from several dealers. Such a customer, however, was required to supply its identity at the time of the request. Plaintiffs allege that these platforms are inferior to the dealer-to-dealer trading platforms in.several ways. Buy-side customers using these platforms are denied streaming prices (they instead receive limited quotes via RFQs); are required to disclose their identities (they cannot remain anonymous); cannot participate in live markets (they are limited to RFQ responses); and are limited in the number of dealers whom they can access.. SAC ¶¶ 78-80; JTSAC ¶¶ 77-80.
Plaintiffs allege that different infrastructures and processes also developed as between dealer-to-dealer and buy-side trading to handle the process of clearing IRS trades. For dealer-to-dealer trades, dealers used central clearinghouses. A clearinghouse is an entity designed to step into the middle of a bilateral trade to reduce counterparty risk. It becomes a counterparty to both sides. It turns the *445 transaction into two separate trades: a sale from the seller to the clearinghouse, and a sale from the clearinghouse to the buyer. Central clearing is common to developed financial markets, including equity and commodities markets. It is essential to anonymous exchange trading, because it brings buyers and sellers to a centralized platform, creates an infrastructure and unified standards for the processing of trades, and eliminates the need for trade- and party-specific creditworthiness assessments. Because each party faced the same counterparty (the clearinghouse), central clearing eliminates the need for contracts between the parties to an IRS. In contrast, in a non-cleared IRS trade, the parties to the trade face each other directly; each party therefore bears the risk that its counterparty will default on its obligations. Plaintiffs allege that central clearing became feasible in the IRS market by the early 2000s. By about 2005, SwapClear, an entity controlled by the Dealers, cleared most interdealer trades. Despite its technological feasibility, however, plaintiffs allege that the central clearing model was not extended to buy-side trades, inhibiting the introduction of an all-to-all trading platform accessible to the buy-side. As addressed below, plaintiffs claim that the lack of central clearing for buy-side trades, before Dodd-Frank took effect, resulted from collusion among the Dealer Defendants. SAC ¶¶12, 90-98; JTSAC ¶¶ 87-96, 348. The Dealers counter that this reflected unwillingness by the buy-side to incur the start-up and ongoing costs associated with a central clearing mechanism, including the posting of substantial collateral to secure cleared trades.
2. Dodd-Frank
On July 21, 2010, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act. Relevant here, Title VII of Dodd-Frank amended the Commodities Exchange Act (“CEA”) to “establish a comprehensive new regulatory framework for swaps,” 3 and vested the Commodities Futures Trading Commission (“CFTC”) with exclusive jurisdiction to implement that framework. 7 U.S.C. §§ 2 (a)(1)(A), 2(h). A goal of Dodd-Frank was to increase accountability and transparency in the financial system, including in the OTC swaps markets, which were viewed as less transparent than the exchange-traded futures and securities markets. SAC ¶ 22; JTSAC ¶¶ 97-98.
The CFTC has issued sweeping regulations implementing Dodd-Frank. Three categories of these regulations are relevant here.
Trading regulations: Dodd-Frank required that certain types of swaps be traded on “swap execution facilities,” or “SEFs.” SAC ¶ 22, 202; JTSAC ¶¶ 97-101. A SEF is defined as “a trading system or platform in which multiple participants have the ability to execute or trade swaps by accepting bids or offers made by multiple participants in the facility or system.” 7 U.S.C. § la(50); 17 C.F.R. § 1.3 (rrrr). Subject to certain exceptions, swaps must trade on SEFs if they are subject to the CFTC’s mandatory clearing rules and have been “made available to trade,” or “MAT,” by a registered SEF with the consent of the CFTC. See 7 U.S.C. §§ 2 (h)(8), 7b-3. 4
Under CFTC regulations issued in 2013, trading on a SEF may occur through ei *446 ther an order book or an RFQ system. See 17 C.F.R. § 37.9 (a)(2). 5 In order-book trading, offers to buy and sell are entered into a matching system and matched either manually or automatically by algorithm.. See generally 17 C.F.R. § 37.3 (a). In RFQ trading, by contrast, a customer can send a price request to a number of counterparties in a particular swap tenor, the prices are relayed back to the customer, and the customer then has a time window in which to execute. Customers who engage in RFQ trading must send requests to trade to a minimum of three recipients. See 17 C.F.R. § 37.9 (a)(3). The CFTC thus enabled, but did not require, that IRSs be traded via an anonymous, all-to-all trading platform.
In February 2014, a CFTC mandate for certain assets “made available to trade” went into effect. See 7 U.S.C. § 2 (h)(8); 17 C.F.R. § 37.10 .
Clearing regulations: Congress believed that the risk of defaults on non-cleared swaps “played in important role in freezing up credit markets” during the 2008 financial crisis. S. Rep. 111-176, at 30 (2010). Dodd-Frank therefore granted broad authority to the CFTC to mandate clearing of swaps. See 7 U.S.C. §. 2(a)(1)(A).
. In 2012, the CFTC enacted a final rule for mandatory clearing , of IRS trades, effective on a rolling basis beginning in March 2013. See 17 C.F.R. §. 37.701; see also Clearing Requirement Determination Under Section 2(h) of the CEA, 77 Fed. Reg. 74,284 (Dec. 13, 2012) (“Clearing Requirements Rule”). 6 In enacting this rule, the CFTC recognized that the vast majority of-new IRS clearing volume would come from the buy-side. See, e.g., Clearing Requirements Rule, 77 Fed. Reg. 74,284 at 74,287. The CFTC delayed implementation of this mandate to 2013, in part due to multiple requests from buy-side entities for extra time to cope with the costs and burdens imposed by implementing mandatory clearing, which one commenter described as “overwhelming.” See Clearing Requirements -Rule at 74,320; Swap Transaction Compliance and Implementation Schedule, 77 Fed. Reg. 44,441 , 44,456 (July 30, 2012). 7
Dodd-Frank used a futures commission merchant (“FCM”) model for clearing, in which an entity called an FCM serves as an intermediary between buy-side clients and the clearinghouse. Plaintiffs allege that the Dealer Defendants’ ownership of almost all of the approximately 20 FCMs for IRS trading effectively made them, under the Dodd-Frank regime, “gatekeepers for IRS clearing.” SAC ¶¶22, 202; JTSAC ¶¶ 97-101 & n.14.
Impartial access regulations: Dodd-Frank requires that SEFs provide all market participants with “impartial access” to their trading facilities, thereby making, for example, buy-side firms free to trade on *447 “dealer-to-dealer” platforms. See 7 U.S.C. § 7b-3(f)(2)(B)(i). This requirement “prevents a SEF’s owners or operators from using “discriminatory access requirements as a competitive tool” against particular market participants. See SEF Rule,, 78 Fed. Reg. 83,476 at 33,508. ,
C. Overview of Plaintiffs’ Theories of Collusion
The following sections first recount plaintiffs’ allegations as to the means used by the Dealer Defendants, before Dodd-Frank took effect, to discourage emergence of an anonymous all-to-all trading platform accessible to buy-side investors. Plaintiffs allege that the different trading platforms and related infrastructure such as clearing mechanisms that developed for inter-dealer versus buy-side IRS transactions result from a long-running conspiracy among the Dealer Defendants and others such as IDBs.
The later sections set out plaintiffs’ allegations as to how the conspiracy continued after Dodd-Frank took effect. Plaintiffs claim that, after several electronic platforms (including Tera’s and Javelin’s SEFs) emerged with potential to enable buy-side IRS transactions to occur on an anonymous all-to-all basis, the conspiracy pivoted to boycotting and destroying these platforms.
D. The Dealers Prevent Tradeweb From Developing an All-to-All Platform
In 1998, Tradeweb was founded as a private, dealer-backed firm that provided an online .marketplace for fixed-income products, such as U.S. Treasuries. Tradew-eb later developed a dealer-to-client RFQ platform for IRSs on which buy-side investors could (non-anonymously) request non-executable and non-binding quotes from dealers. It was thus an OTC platform that facilitated the dealers’ roles as the sole IRS market makers. Because Tradeweb’s platform relied on the dealers to make markets, its success depended on the dealers’ use of the platform. In 2004, the dealers sold Tradeweb tó Thomson Corporation. SAC ¶¶ 100-01; JTSAC ¶¶ 273-74.
Plaintiffs allege that—-with IRS trading volumes having grown and IRS products having evolved to the point where introduction of all-to-all electronic trading market was feasible—the Dealer Defendants perceived a threat to their position as the primary IRS market makers. In response, and aware that other financial instruments had migrated from OTC trading, Goldman Sachs’ Principal Strategic Investments Group (“PSI”) devised a “dealer consortium” strategy to work with the other Dealers “to maintain control of the IRS market.” The PSI’s principal goal was to control how markets would evolve so as to protect the “dealer community” from the threat to profitability presented by electronic exchanges and other forms of all-to-all trading that threatened to “disin-termediate” the dealers. Specifically,, the PSI recognized that, if the buy side of the IRS market shifted to all-to-all platforms, buy-side entities would be able to trade directly with one another. This, in turn, stood to diminish the profits earned by the Dealer Defendants from serving as intermediaries in the dealer-to-client market. Plaintiffs allege that similar “strategic investment” groups at other Dealers (including at Bank of America, Barclays, Citibank, Credit Suisse, Deutsche Bank, and J.P. Morgan) existed to control market structures and that dealers who lacked a distinct group, such as BNPP, “conduct[ed] similar strategic activities through their trading business.” Plaintiffs allege that, between 2008 and 2016, these groups “regularly met in private,” communicated by phone and electronically, and “secretly collaborated,” to protect their “privileged status as dealers in markets they have *448 historically controlled.” SAC ¶¶ 102-09; JTSAC ¶¶ 275-82.
This collaboration, plaintiffs allege, involved regaining control of Tradeweb “to prevent it from introducing all-to-all trading.” By late 2007, plaintiffs allege, Tra-deweb was planning to introduce electronic all-to-all trading to the IRS market, for which there was great demand from the buy-side. Tradeweb had touted itself as a “real-time trading platform” and represented that it was “well positioned to capture new business as the market migrates to more efficient electronic trading platforms.” In response, members of three strategic investment groups—Goldman Sachs (Brad Levy), Deutsche Bank (Stephen Wolff), and Lehman Brothers (Dexter Senft)—“devised and implemented a scheme to eliminate the threat from Tra-deweb.” SAC ¶¶ 111-12; JTSAC ¶¶283-84.
Specifically, plaintiffs allege, Levy, Wolff and Senft recognized that Tradeweb’s liquidity contracts with the Dealers—which Tradeweb needed to drive liquidity to its RFQ and eventually its all-to-all platform—were expiring. This gave the Dealers leverage over Thomson, which “realized the banks would take their liquidity and shop it around, which would threaten the value of TradeWeb.” To exploit this leverage, Levy, Wolff and Senft recruited other Dealers to join an initiative they named “Project Fusion.” It was designed to enable the Dealers to take control of Tradeweb’s IRS business to eliminate Tra-deweb as a threat, but without attracting scrutiny. SAC ¶¶ 113-14; JTSAC ¶¶285-86.
Project Fusion, plaintiffs allege, entailed first taking over majority ownership of a company that would be the entity through which the Dealer Defendants controlled Tradeweb, while making it appear that they were taking only a “minority” stake as investors. To this end, on October 1 and 2, 2007, the Dealer Defendants and Tra-deweb formed two Delaware LLCs. The first, “Tradeweb Markets LLC,” would be “the public face of the deal and the one through which [defendants would take a minority stake in exchange for paying $180 million to Thomson[,]” Tradeweb’s then-parent. The second was “Tradeweb New-Markets LLC”; the Dealer Defendants paid Thomson approximately $280 million for an “overwhelming majority stake (80%) in this entity,” which would “house Tra-deweb’s IRS business.” Plaintiffs allege that the Dealers gave the two new entities similar names and used the generic name “Tradeweb” in their press releases, to conceal their control over the entity responsible for IRS trading. Plaintiffs allege these press releases also misleadingly claimed the Dealers were investing in Tradeweb’s business to provide “a significant opportunity for institutional investors to benefit from the efficiencies of electronic trading,” when in fact, their purpose was to keep Tradeweb from offering an all-to-all platform. 8 Plaintiffs allege that the Dealers agreed with each other “(1) that Tradeweb would not move forward with an all-to-all trading platform or support other platforms that would.move the market toward all-to-all trading; and (2) to provide liquidity to Tradeweb’s platforms to the exclusion of competing platforms.” SAC ¶ 115— 25; JTSAC ¶¶ 287-94.
*449 After obtaining these stakes, plaintiffs allege, the Dealer Defendants installed their senior personnel on the boards of Tradeweb Markets, LLC (16 of 26 seats) and Tradeweb NewMarkets, LLC (16 of 24 seats). These included named personnel from Goldman Sachs, Bank of America, Barclays, . Citibank, Credit Suisse, Deutsche Bank, J.P. Morgan, Morgan Stanley, RBS and UBS. The CEO of both entities was a former chief operating officer for fixed income at Credit Suisse. SAC ¶¶ 126-37; JTSAC ¶¶ 295-06.
Plaintiffs allege that the boards’ members “include some of the primary architects of the conspiracy” and communicated in several ways. Members “met regularly under the cover of Tradewéb’s boards and committees to plan how the Dealer Defendants could maintain control of the IRS market and make sure they were not ‘disintermediated’ by buy-side friendly IRS trading platforms.” There were also often-weekly board conference calls, and an annual board meeting in Miami, Florida, which, plaintiffs claim, the Dealers used “to discuss and coordinate their strategy for controlling the IRS market.” The Dealers also allegedly controlled Tradeweb through governance committees that determined, inter alia, who can participate on Tradeweb’s SEFs. Finally, the Dealers’ personnel discussed “market structure issues” at dinners at the home of the head'of interest rate swaps for Tradeweb’s inter-dealer SEF and at New York City restaurants, attended by Dealer representatives. In these gatherings, plaintiffs allege, the Dealers “coordinate^ their strategy” and “discussed their plans for keeping the market bifurcated and preventing the natural progression to all-to-all trading.” SAC ¶¶ 138-41; JTSAC ¶¶ 307-10. ■'
In November 2010, Tradeweb New-Markets LLC merged into Tradeweb Markets LLC, leaving the latter as the surviving company. The Dealers continued to hold a majority of seats on the surviving entity’s board. SAC ¶ 142; JTSAC ¶ 311.
Plaintiffs allege that, from Project Fusion forward, Tradeweb, while holding itself out as independent, acted for the benefit of the Dealers. Although Tradeweb’s independent (i.e., non-bank) managers recognized that it would be in Tradeweb’s interest to launch an all-to-all anonymous electronic trading platform, the Dealers pressured them to change course; these managers capitulated. Plaintiffs allege that the Dealers publicly touted Tradeweb as a platform that could provide “accurate pricing information” and “greater market transparency.” In fact, these claims were untrue as to the dealer-to-client OTC market structure, in that the “buy side can trade on Tradeweb only via its dealer-to-client RFQ platform and cannot engage in all-to-all trading.” The decision to forego all-to-all trading cost Tradeweb additional business and profits from the resulting fees. SAC ¶¶ 143-46; JTSAC ¶¶ 312-15.
As of the date of the SACs, plaintiffs allege, Tradeweb, pursuant to its agreement with the Dealer Defendants, “continues to play an active role in maintaining a two-tiered market structure.” Post-Dodd-Frank, Tradeweb today operates two different SEFs: Dealerweb SEF, which plaintiffs claim is meant only for dealers and allows anonymous competitive trading; and Tradeweb SEF, which “is designed for non-dealer market participants and always discloses counterparty identities.” To deal on the former, Tradeweb charges $50,000 per month and requires that an entity pay for a minimum of a full year (ie., $600,000). But it charges only $100 per month to trade on Tradeweb SEF. The reason for this cost differential, plaintiffs allege, is to “establish and entrench a bifurcated dealer-to-dealer - and dealer-to-eustomer marketplace.” Plaintiffs also allege that while Tradeweb SEF claims to *450 offer an “order book,” it is effectively closed off to the buy side, because dealers do not trade on that platform, but instead trade with each other on Dealerweb or other IDBs and limit trades with end users to the dealer-to-client RFQ. The Tradeweb platform is thus “inactive and seen by the buy side as inaccessible.” SAC ¶¶ 147-49; JTSAC ¶¶ 316-19.
E. The Dealers Use Trade Associations as Forums for Collusion
Plaintiffs identify Tradeweb as the “principal forum though which the Dealer Defendants ,.. colluded to coordinate their efforts to control the IRS market.” But, they allege, the Dealers also used two trade associations as means of collusion. SAC ¶ 151; JTSAC ¶ 320.
One was ISDA. From 2008 forward, the Dealers controlled ISDA’s board, on which employees of 10 Dealer Defendants sat. Another was the Futures Industry Association (FIA), on whose board employees of 10 Defendant Dealers sat. Among the working groups created by these trade associations was one devoted to drafting the “Cleared Derivatives Execution Agreement (“CDEA”),” a form contract intended to govern the relationship between clear-, ing agents - and their customers. After Javelin came to exist, its executives sought to attend a meeting of this working group out of concern that the CDEA was being drafted only for OTC transactions and did not anticipate IRS trades covered on a SEF; Javelin’s CEO and general counsel were permitted to attend, but when the general counsel inquired about the CDEA, her question was not answered. The chair of the meeting, a Credit Suisse in-house counsel, later told Javelin that its personnel were unwelcome at future meetings. SAC ¶¶ 152-57; JTSAC ¶¶ 321-27. 9
F. The Dealers Prevent IDBs from Opening Platforms to the Buy Side
' The SACs allege that, in• several' contexts, the Dealer Defendants acted’to prevent IDBs from opening all-to-all trading platforms to buy-side investors. •
1. Punishment of IDBs That Took Steps Towards AI1-to-All Platforms
Plaintiffs allege that the Dealers threatened to punish any IDB that considered opening its platforms to the buy side, This included threatening to withdraw liquidity from such platforms, which the Dealers referred to as placing the IDB in the “penalty box” or “pulling the line” on the IDB. Twice, in 2009 and 2014, GFI group (“GFI”), which operates IDB platforms, attempted to.introduce anonymous trading protocols on its platform; each time, the Dealers threatened to pull their business from GFI, which reversed course. In the 2014 episode, GFI received heated phone calls from Credit Suisse and J.P. Morgan, and reverted to using a name-disclosed protocol. The Dealers also threatened buy-side investors with the “penalty box" for attempting to trade on an all-to-all platform. Such threats were effective, plaintiffs-claim, because they deprived the investor of access to primary market makers and thus from trading IRSs; the Dealers sometimes also threatened investors with “withdrawal of key banking services.” As a result of these tactics, plaintiffs allege, IDBs did not open their platforms to’ the buy side. SAC ¶¶ 159-65; 'JTSAC ¶¶ 328-34.
2. The Dealers’ “Détente” With ICAP
In 2009, plaintiffs allege, defendant ICAP agreed with the Dealer Defendants *451 to prevent the buy side from accessing its platform, as part of an agreed “détente.” ICAP had contemplated giving such access to the buy side in retaliation for Tradeweb and the Dealers having launched a trading platform for mortgage bonds called “Deal-erweb,” which cut into ICAP’s mortgage-bond platform’s business. In retaliation, ICAP threatened to launch an all-to-all trading platform open to the buy side. This threat, plaintiffs claim, was credible because ICAP was developing an electronic-trading platform for Europe called iSwap, which ICAP could have launched in the United States as an all-to-all anonymous IRS trading platform, and/or because ICAP could have allowed buy-side investors to use its existing IDB platform. In response, representatives of ICAP and the Dealer Defendants spoke in. 2009 and reached a dátente. The Dealers agreed not to further expand Dealerweb into the IDB space; in exchange, ICAP agreed not to establish an all-to-all anonymous trading platform. SAC ¶¶ 166-69; JTSAC ¶¶ 335-37.
Plaintiffs allege that ICAP and the Deal: ers have abided by that agreement, despite iSwap’s success and the potential to ICAP of expanding iSwap to the United States. They allege that when ICAP did expand that platform to the United States in 2013, it took steps that effectively limited participation to the Dealers, while publicly claiming otherwise. The Dealers, in turn, abiding by the detente, have kept Dealer-web from expanding into IRS or any other market in a meaningful way. SAG ¶¶ 166-73; JTSAC ¶¶ 336-42.
G. The Dealers’ Attempts to Block Buy-Side Clearing
Plaintiffs allege that the Dealer Defendants identified the central clearing of OTC products as a first step towards electronic trading. They cite a 2010 report from J.P. Morgan describing clearing as a “main concern for the Investment Banking industry” because it could lead to “exchange/SEF trading for OTC products.” As a result, plaintiffs allege, the Dealers long sought to control the clearing infrastructure for the .financial .markets they dominate, to position themselves to “head off threats to their dominance.” In the context of the IRS markets, the Dealers allegedly took control of the IRS clearing infrastructure, and their representatives allegedly met'-to discuss “how to prevent or delay buy-side access to IRS clearing.” These discussions occurred- on Tradeweb and through an entity called OTCDeriv-Net.” SAC ¶¶ 174-75; JTSAC ¶¶ 343-44.
Plaintiffs allege that the Dealers took several steps to block such clearing.
, First, the Dealers agreed, through their strategic investment groups, to take control of an IRS clearinghouse, “SwapClear,” formed in 1999 by LCH.Clearnet, an entity that builds clearinghouses for financial instruments. To do so, eight Dealers, in October 2000, formed OTCDerivNet; four others joined in 2001 and two others in 2009. They held out OTCDeriv.Net as for ah IRS participants, including the buy side. In. fact, plaintiffs allege, OTCDerivNet was formed as a vehicle to secure control of SwapClear. After creating the new- entity, the Dealers announced that it would “partner” with LCH.Clearnet.to develop a secure, efficient and cost-effective trade environment” for the OTC. derivative industry. In fact, the Dealers, through OTCDerivNet, provided 100% of the funding of SwapClear, in return for a share of profits and governance control. Using that control, the Dealers imposed restrictions that effectively limited clearing membership. only to Dealers. These included that any new member must put up $5. billion in capital towards the clearinghouse, a sum so large only investment banks could afford it.-The Dealers also required unanimous approval of existing members before *452 a new member could join. SAC ¶¶ 176-80; JTSAC ¶¶ 345-49.
Second, plaintiffs allege, the Dealers, through their board domination of OTC-DerivNet, acted to block other buy-side clearing ventures. In the mid-2000s, the Chicago Mercantile Exchange (“CME”), a sophisticated entity with a long history of developing clearing solutions for financial markets, was focused on doing so for swaps markets, including IRSs and CDSs. It announced plans to introduce a cleared IRS product called “CME Cleared Swaps,” which promised to offer clearing of OTC swaps executed on or submitted through its trading platform Swapstream or through its OTC platform. Given CME’s track record and technical and commercial ability, the Dealers viewed this as a “serious threat.” In response, plaintiffs allege, the Dealers boycotted Swapstream. “Meeting through OTCDerivNet, the Dealer Defendants agreed to clear only interdealer IRS trades and only on SwapClear (the entity they controlled).” Because the Dealers are a party to nearly every IRS trade, plaintiffs allege, their collective refusal to clear IRS trades through, Swapstream meaning that effectively no trades were cleared through the platform, “starving CME of clearing volumes and revenues.” As a result, “CME’s clearing solution for IRS[s] swiftly failed.” SAC ¶¶ 181-88; JTSAC ¶¶ 360-56.
Third,' after the passage of Dodd-Frank, regulators put pressure on the Dealers to expand clearing in derivatives markets and to open up clearing to the buy side. In response, plaintiffs allege, the Dealers made superficial changes at SwapClear that purported to expand buy-side access, while adopting new rules that prevented meaningful buy-side participation. For example, they added a rule that needlessly required clearing members to contribute large amounts of capital to the clearinghouse’s default (or “guaranty”) fund. Only large investment banks like the Dealers could meet this requirement. SAC ¶¶ 189— 90; JTSAC ¶¶ 357-58.
Fourth, as noted, Dodd-Frank mandated that certain IRSs move to SEFs and be centrally cleared. Dodd-Frank’s FCM model of clearing made the FCM divisions owned by the Dealer Defendants— most FCMs—the “gatekeepers” for IRS clearing. Plaintiffs allege that the Dealers exploited this by causing their FCMs to refuse to clear buy-side trades on IRS trading platforms that use all-to-all protocols. Plaintiffs allege that FCMs should be agnostic as to which trading platforms their customers use; any trade it clears adds to its revenue. But, plaintiffs allege, the Dealers caused their FCMs to withhold clearing services from any buy-side entity seeking to trade on SEFs that operated all-to-all anonymous trading' platforms, including Tera, Javelin, and TrueEx. This practice was aimed at preventing IRS trades from proceeding on these platforms. Separately, plaintiffs allege, FCMs refused to carry out pre-trade checks for any prospective trade on an anonymous all-to-all SEF. This restricted order flow of buy-side customers onto all-to-all plátforms. Plaintiffs allege that the Dealers coordinated these activi-. ties through their clearing operations, which communicate regularly and meet “under the cover of FIA board meetings.” SAC ¶¶ 191-201; JTSAC ¶100.
H. The Dealers Attempt to Block SEFs Offering All-to-All Trading
Plaintiffs ‘ allege that, after Dodd-Frank’s implementing regulations took effect, the Dealer Defendants conspired to boycott and destroy the SEFs that emerged and that promised to offer all-to-all anonymous trading of IRSs. As developed below, plaintiffs allege that three companies—TeraExchange, Javelin, and *453 TrueEx—each spent millions of dollars developing such platforms. But, plaintiffs allege, the Dealers conspired to boycott these platforms, and to cause their affiliated clearing entities to refuse to clear trades on them. Plaintiffs allege that the Dealers coordinated their “joint opposition” to these SEFs through their “strategic investment groups,” through “secret discussions,” and through a forum supplied by an IDB called “Tradition,” which, between 2013 and 2015, hosted monthly meetings in New York City with the collective heads of the Dealers’ trading desks to discuss issues relating to SEFs. Plaintiffs further allege that, when a SEF solicited participation by the Dealers, the Dealers coordinated their response; for example, a Goldman Sachs employee in its E-Commerce division would call his counterparts to discuss whether to use the platform. As a result, “Goldman Sachs and the other Dealer Defendants did not make individual decisions about which SEFs to support. They made those decisions in collaboration with each other.” SAC ¶¶ 202-06; JTSAC ¶¶ 124-42.
The effect of the “roadblocks” implemented by the Dealers, plaintiffs allege, was that, whereas it had been forecast that 40-50 firms could end up competing for swaps execution business, the three SEFs that invested heavily in doing so were “largely crushed by the Dealer Defendants’ cartel.” Each had developed the necessary technology, secured the required regulatory approvals, and garnered sufficient support to introduce anonymous all-to-all trading platforms to the buy side. But, plaintiffs allege, the Dealers’ tactics— including refusing to trade on these new platforms, refusing to let their affiliates clear buy-side trades executed on the new platforms, and threatening to retaliate against anyone who traded on the platforms—“effectively shut down Tera Exchange and Javelin.” The Dealers allegedly used similar strategies to limit dealer-to-client trading on TrueEx’s platform to by RFQ protocols. As a result, plaintiffs claim, a dichotomous IRS trading market persisted, in which the buy side “continues to be shut out of all-to-all electronic trading” but the Dealers are not. SAC ¶¶ 207-09; JTSAC ¶¶ 138, 141-42.
1. The Boycott of TeraExchange
Tera was formed in 2010. It raised $7 million in capital. It developed all-to-all electronic trading platforms for asset classes including IRSs—platforms which it claimed promised greater price transparency and competition and to offer firm quotes to the buy-side. Tera developed the technology necessary for such a platform, including swap data repositories, connectivity with the various clearinghouses and credit hubs, and a system to ease the calculation and posting of collateral. Tera offered “full market depth” and “real time pricing.” JTSAC ¶¶ 115-16.
Tera, with such features, began , offering access to its electronic platform in 2011, while it waited for the CFTC to formalize SEF registration rules. Tera was described at the time as poised to take business from “the big banks that have dominated swaps trading.” While it welcomed the Dealers to participate on its platform, plaintiffs allege, Tera did not depend on them. Instead, it focused on recruiting large proprietary trading firms that were eager to trade IRSs, 15 of which the SAC names. These firms, plaintiffs allege, “were ready, willing, and able to provide the liquidity to the Tera platform that would allow the platform to thrive,” were eager to trade IRSs, and “were willing to quote immediately executable bid/ask spreads” that were tighter than those offered by traditional dealers. Plaintiffs allege that, had these proprietary trading firms participated in Tera’s platform, then Dealers would effectively have been obliged to use the platform as well. That is because Deal *454 ers’ clients often demand that Dealers supply .them “best execution,” meaning securing the best price available in executing a trade when acting as the customer’s agent. Had the best price been available on Tera, plaintiffs allege, Dealers would have been required “by regulation or contract” to obtain it, leading to execution of trades on that platform. SAC ¶¶ 210-17; JTSAC ¶¶ 119-20.
In preparation for its launch, plaintiffs allege, Tera made its platform compliant with regulatory rules. On September 19, 2013, the CFTC granted Tera temporary SEF certification. And numerous market participants, 12 of which plaintiffs name, committed to provide liquidity to the platform. By the end of 2013, Tera was valued at more than $50 million. SAC ¶¶ 217-19; JTSAC ¶¶ 122-23.
Plaintiffs allege that the Dealers “conducted secret meetings, including under the cover of Tradeweb, to discuss how to neutralize this threat,” which the Dealers termed a “Trojan Horse.” One tactic was to attempt to jointly invest in Tera, “with the real goal of taking it over and shutting it down.” Several Dealers reached out to Tera to arrange meetings; at these, in early 2013, Tera expected to discuss trading but were instead “met by strategic investment personnel' offering to take a stake in TeraExchange’s company.” One meeting was with two Goldman Sachs officials; similar tactics were used by strategic investment groups at Barclays, Bank of America, Credit .Suisse, Citi, Deutsche Bank and Morgan Stanley. Tera declined the Dealers’ “investment” offers; no Dealers signed up for Tera’s platform or ever agreed to provide liquidity, “pursuant to their agreement to starve TeraExchange of liquidity.” SAC ¶¶ 220-24; JTSAC ¶¶ 186-88.
Plaintiffs allege that the Dealers used other “aggressive tactics” to thwart Tera. One was refusing to clear, on their FCMs, trades of any of their buy-side clients occurring on Tera; Tera received reports from those who had signed up for it that these FCMs were refusing to clear. To obscure this refusal, at times, these FCMs would quote “extremely high clearing fees” for trades executed on Tera, while quoting far lower fees for clearing trades on platforms they did not view as threats. For example, Bank of America’s FCM quoted Knight Capital Group “exorbitant clearing fees” to Tera, while charging Knight no clearing fees for trades executed “on dealer-friendly platforms such as Tradeweb and Bloomberg.” When Tera tried to convince FCMs to change course and clear trades, one official, at Bank of America, replied: “My bosses are never going to let me” clear trades for TeraExchange. SAC ¶¶ 225-28; see also id, ¶¶ 229-31 (citing “runaround” explanations for non-participation given to Tera by Barclays, Morgan Stanley, Credit Suisse, HSBC, and ANZ Bank); JTSAC ¶¶ 189-210 (alleging refusals to clear by FCMs of numerous dealers).
The Dealers’ “collective refusal” to clear trades on Tera’s platform “was a major blow” and caused early supporters to. withdraw. Plaintiffs also allege that several buy-side entities indicated to Tera that they “were facing reprisals” from dealers for meeting with. Tera. On Friday, June 13, 2014, two. large trading platforms successfully conducted the first trade on Tera’s order book, a single trade for a notiqnal amount of $10 million. The trade was to be cleared through BNPP’s clearing affiliate, but BNPP’s trading desk “immediately contacted the parties to the trade and threatened them with a loss of access to clearing and other banking services, including execution services in other asset classes and access to general market research, if they continued to trade on Ter-aExchange.” The -next business day, Monday, June 16, 2014, BNPP, Citibank, J.P. *455 Morgan, and UBS, “each separately contacted TeraExchange demanding to ‘audit’ TeraExchange’s rulebook and stating that they would not help clear any further trades until the audit was complete.” There was, in fact, no valid basis for such an audit, as Tera had already been certified by the CFTC; the Dealers’ “real goal was to prevent the buy side from trading on TeraExchange.” At around the same time, Bank of America’s FCM “threatened buy-side clients with inflated clearing fees and liquidity boycotts if they' made markets or traded on Tera’s all-to-all trading platform.” As a result, no such trades took place. SAC ¶¶ 232-36; JTSAC ¶¶ 206-10.
Plaintiffs allege that the Dealers shut down a different means by which Tera attempted to build its platform. Because Dodd-Frank requires certain IRS trades involving U.S. entities—whether trading domestically or internationally—to be executed through a SEF, Tera recognized that European IDBs serving U.S. banks had to become a SEF or execute their trades through a SEF. Tera reached out to European IDBs, which lacked proprietary SEFs, to offer them its services; it initially received favorable responses. The Dealers, however, “shut down” this effort. “In strikingly parallel fashion, in early- to mid-2014, the Dealer Defendants informed these IDBs they would not accept any trades reported or executed on TeraEx-change.” Citibank and BNPP in particular each told an IDB that they would; not accept trades reported or executed on Tera, and the CEO of a second-tier IDB told Tera that the major swap dealers would not allow him to sign up with Ter-aExchange. SAC ¶¶ 237-42; JTSAC ¶¶ 211-16.
In the end, plaintiffs allege, these efforts succeeded. “[T]o date, no IDB has been able to process a trade through TeraEx-change’s order book, and some have since gone .out of business.” TeraExchange, in turn, shifted its focus to other lines of business, and “effectively left the IRS market.” SAC ¶¶ 243-44; JTSAC ¶¶ 217-18.
2. The Boycott of Javelin
Javelin was formed in 2009. It developed two all-to-all IRS trading platforms—an anonymous RFQ platform and an anonymous order book, both offering firm pricing for swaps as opposed to indicative quotes. In 2011, it began soliciting support for its platforms by giving demonstrations to buy-side entities and five Dealer Defendants (BNPP, Deutsche Bank, Goldman Sachs, J.P. Morgan, and RBS). It offered these Dealers the opportunity to receive a portion of Javelin’s brokerage fees if they traded on the platform. Javelin’s platform, which had a “state of the art user inter.face,” successfully tested both as to execution and clearing of trades. It contained options to allow market participants to trade electronically either through that interface or through an industry-standard third-party gateway. The development of Javelin’s • SEF and technology platform called upon “enormous industry knowledge and technological skill,” as well as substantial investments in, among other things, office rental, data center fees, and licenses for software and financial vendor platforms. By 2011, Javelin’s order book was ready for testing and had successful test trials; by 2013, Javelin had created its own live credit-check system, which enabled Javelin to confirm that the customer had sufficient credit with their FCM to execute and clear a trade. On September 19, 2013, the CFTC granted Javelin temporary registration as a SEF, and Javelin’s platforms were operational. On October 1, 2013, Javelin successfully executed and. cleared its first trade as a SEF; by late 2013, Javelin had signed up seven second-tier dealers to trade on the platform. SAC ¶¶ 246-48; JTSAC ¶¶ 104-12.
*456 Most Dealers, however, refused to provide liquidity to Javelin. This, plaintiffs claim, reflected an agreement “with each other only to support platforms they could control.” Plaintiffs allege that the Dealers recognized that if Javelin successfully launched an anonymous all-to-all platform, this “would imperil them privileged status as market makers in a bifurcated market, as well as the supracompetitive bid/ask spreads they extracted from the buy side.” SAC ¶¶ 247-48; JTSAC ¶ 148.
Between 2013 and 2015, Javelin met with senior employees at each Dealer, seeking them support. Of the Dealers, only RBS, for a short period, agreed to trade or provide liquidity to Javelin. Some Dealers refused to use the platform; others “provided an endless stream of pretextual excuses,” such as the need for legal reviews of Javelin’s rulebook, for refusing to do so; one stated that it needed to see Javelin’s internal documentation but never did so. Some refused to test the platform’s opera-bility; others “flatly refused to engage.” Plaintiffs claim that J.P. Morgan initially proclaimed interest in trading on Javelin, but this “was merely a ruse to collect information on its trading platforms,” in that J.P. Morgan “burdenfed] [Javelin personnel] with numerous pretextual requests for information.” SAC ¶¶ 249-50; JTSAC ¶¶ 143-45, 149, 151-61.
In September 2013, Javelin conducted a series of mock trading sessions to showcase its all-to-all platforms to dealers and buy side entities. In advance of these sessions, Javelin asked the Dealers to conduct pre-trade credit checks for their buy-side customers to participate in these sessions. The Dealers’ FCMs, including J.P. Morgan’s, “largely refused” to do so, “effectively preventing the buy side from using Javelin’s platform.” Morgan Stanley similarly refused to act when Javelin, claiming to speak for a number of Morgan Stanley’s FCM clients, asked it to connect to the platform so enable those clients to trade. Eventually, a Morgan Stanley official agreed to a demonstration of the platform’s functionality, but delayed attending; even though the demonstration was successful, Morgan Stanley refused to clear trades executed on the platform. SAC ¶¶ 251-54; JTSAC ¶¶ 146, 154.
Deutsche Bank allegedly gave Javelin “a similar runaround.” For months, it claimed that its legal department needed to approve Javelin’s rulebook. This delay prevented seven buy-side entities that cleared trades through Deutsche Bank from trading on Javelin, as they had wished. Deutsche Bank also refused to test Javelin’s connection to it, claiming a lack of capacity, even though, plaintiffs claim, testing the connection would have been simple. Plaintiffs allege that there were conversations over a period of 15 months that reveal an evolving series of excuses by Deutsche Bank for not doing such testing, for not completing a “legal review,” and ultimately, for not approving trades on Javelin. SAC ¶¶ 255-61; JTSAC ¶¶152, 162-69. Other Dealers, including Morgan Stanley and Barclays gave similar, allegedly pretextual, excuses for not allowing their FCMs to clear trades executed through Javelin. JTSAC ¶¶ 170-72.
Goldman Sachs also allegedly refused to allow its FCM to clear such trades. Although its officials did not state that Goldman Sachs would not support Javelin, its officers “demonstrated hostility” to Javelin at a September 24, 2013 meeting, and asked for the names of buy-side entities that had signed up to use the platform.” The next week, Javelin employees confronted a Goldman Sachs official, Tony Smith, a vice president of network engineering, about its refusal to clear trades executed on Javelin. “Smith responded that under no circumstances would Goldman Sachs deal with Javelin” and that “if *457 Goldman Sachs was somehow forced to clear trades executed on Javelin, it would simply set the credit limits for all of its customers who attempted to trade on Javelin at ‘zero,’ thereby preventing the clearing of any trades executed on its platforms.” Thus: “Goldman Sachs’ FCM was willing to forego clearing revenues and damage customer relationships in order to shut Javelin out of the market. SAC ¶¶ 262-63; JTSAC ¶¶ 154, 170.
Some Dealers “actively pressured their customers not to trade on Javelin.” In August 2013, Senft, by then of Morgan Stanley, asked Javelin for a list of the buy-side customers who had expressed interest in Javelin; after Javelin gave this information, Senft distributed this list to other Dealers. One such customer, NISA Investment Advisors LLC (“NISA”) had been eager to trade on Javelin. But when Goldman learned this from Senft, a Goldman official notified NISA that “if NISA traded on Javelin, Goldman Sachs would withdraw all clearing services for the buy-side entity in any trading venue.” NISA later backed out of using Javelin’s platforms; a NISA official later told Javelin that Goldman Sachs had forced him to stop trading on the platform. Another buy-side entity, the Citadel Fixed Income Master Fund, started using the platform in early 2014 but “suddenly stopped” such trading after its chief operating officer “received calls from the Dealer Defendants telling him not to use Javelin’s platforms.” SAC ¶¶ 264-66; JTSAC ¶¶ 173-74.
Despite these obstacles, plaintiffs allege, Javelin got some trading volume from its participants, having signed up, by late 2014, approximately 80 entities (19 named in the SAC) to trade on its all-to-all platform. But, because the Dealers refused to allow Javelin-based trades to clear through their FCMs and because of “the threats ... described above,” many potential customers of Javelin were unable to clear trades executed there, and, ultimately, “few were able to make any trades.” One buy-side entity, Mitsubishi, told Javelin that it had ceased attempting to trade on Javelin because it had “received ‘too much static’ from J.P. Morgan, [its] FCM, for doing so.” In October 2014, “buy-side interest in Javelin and other all-to-all trading platforms collapses as buy-side investors grew concerned the Dealer Defendants would retaliate against them for trading on the platform.” Also in October 2014, a Deutsche Bank executive met with and told a Javelin official that “if he continued to push for Javelin’s success, he would ‘never work’ on Wall Street again.” SAC ¶¶ 267-70; JTSAC ¶¶ 173-78.
In sum, plaintiffs allege, the Dealers had “clearly coordinated their joint opposition to Javelin”; and proffered, in conversations with Javelin employees between August 2014 and April 2014, “nearly identical excuses for their refusal to deal, pointing to a supposed lack of buy-side participation on Javelin as the reason for their actions.” But these excuses, plaintiffs claim, were pretextual, because these Dealers “had gone to great lengths to ensure that buy-side firms did not trade on Javelin.” SAC ¶¶ 271-72.
As for RBS, plaintiffs allege that it initially provided liquidity on Javelin, although hot “in a meaningful way,” and the prices that RBS streamed were “at unfavorable bid/ask spreads that resulted in no trades with buy-side customers.” Meanwhile, RBS demanded significant control in the operation and strategy of Javelin’s platform. After Javelin, on October 18, 2013, filed an application with the CFTC that stood to allow a wide range of cleared IRSs to be executed on SEF’s, plaintiffs allege, a senior IRS trader at RBS complained to Javelin’s CEO, James Cawley, and RBS soon withdrew all its liquidity on the platform. In the ensuing days, a half- *458 dozen RBS officials pressured Cawley to retract that submission. On October 30, 2013, Javelin filed a revised submission, narrowing the range of IRS instruments it covered. Even so, RBS and other Dealers continued to pressure it to reduce the scope of its application. Only after Javelin narrowed its submission did RBS resume providing Javelin with liquidity. Plaintiffs further allege that RBS’s head IRS trader told Javelin not to discuss that RBS was a market maker on its platform, and that RBS gradually began widening the bid/ask spread it would stream to Javelin and otherwise distancing itself from Javelin. On April 26, 2015, RBS withdrew as a participant on Javelin’s platform. SAC ¶¶ 273-78; JTSAC ¶¶ 158-61.
In October 2014, plaintiffs allege, buy-side interest in trading on Javelin “collapsed” .when buy-side customers learned that all-to-all trades on Javelin were not assured anonymous. News of this spread via, a Dealer-friendly IDB. JTSAC ¶ 179.
As a result of the Dealers’ actions, plaintiffs allege, Javelin today “effectively has no revenues aná facilitates no IRS trading. “Despite years of development and -millions of dollars in investment capital. Javelin has executed less than 180 trades since its launch.” SAC ¶ 278; JTSAC ¶¶ 177-78, 182-84.
3. The Boycott of TrueEx
TrueEx was founded by Sunil Hirani, who - had previously started a successful electronic trading platform for CDSs for an IDB called Creditex. In 2013, TrueEx sought to bring to market a SEF offering two IRS trading platforms: an anonymous all-to-all order book and a non-anonymous dealer-to-client RFQ platform. Approved by the CFTC, the TrueEx swaps exchange had features that caused it to be touted as having potential to increase competition and reduce prices in derivatives markets. Hirani stated publicly that TrueEx had signed up 62 buy-side participants. SAC ¶¶ 279-81; JTSAC ¶¶ 219-22.
Plaintiffs allege that the Dealer Defendants boycotted TrueEx, by refusing to trade IRSs with buy-side investors on the TrueEx order book. They allege generally that, were a buy-side investor to execute á' trade on TrueEx’s order book, it would have to clear the trade through one of the Dealers’ FCMs, which would alert the Dealers to this, causing them to retaliate. They further allege that the Dealers refused ,to use the TrueEx platform for dealer-to-dealer trading, a refusal which “makes no sense, except as part of [defendants’ conspiracy,” because TrueEx offered better, financial terms than other platforms in which the Dealers traded, such as Tradeweb, The Dealers did provide “some limited liquidity to TrueEx’s non-anonymous dealer-to-client RFQ platform,” but ensured that this platform did not “reach critical trading mass” by refusing to trade “plain vanilla swaps”—those that trade in the highest volumes around the world—with the buy side on TrueEx, Instead, they limited such trading to “bespoke, one-off swaps, which trade in significantly smaller volumes.” There is no legitimate explanation for this behavior, plaintiffs claim, given that TrueEx provides “better technology with lower fees.” Plaintiffs claim that the Dealers’ conduct successfully neutralized TrueEx “from bringing an all-to-all platform to market and' becoming a competitive threat.” SAC ¶¶ 282-87; JTSAC ¶¶ 223-25.
I. The Dealers’ Insistence on “Name Give-Up”
• Plaintiffs allege that—both before and after Tera and Javelin’s platforms emerged—the Dealer Defendants insisted on maintaining a historical practice they called “name give-up,”-in which the names of each party to an IRS are identified to the other. The compulsory disclosure of swap counterparties, plaintiffs- claim, *459 serves as a policing mechanism, allowing the Dealers to retaliate against entities that attempt to trade on all-to-all platforms. In fact, buy-side investors prefer not to disclose their trading strategies and needs. Although “name give-up” served a purpose in an earlier era, as identification of the counterparty enabled assessment of its creditworthiness, now that IRS trades are centrally cleared, there is no need for the counterparty’s name to be disclosed, SAC ¶¶ 292-95 (quoting commentators as to lack of justification today for “name give-up”); JTSAC ¶¶ 234-41 (same).
Plaintiffs allege that the Dealers enforce “name give-up” by various means, Dealer officials—including at Goldman (Levy), Deutsche Bank (Wolf) and Barclays and Morgan Stanley (Senft)—conditioned giving liquidity to a platform on its using “name give-up.” Other Dealers joined this practice. Dealers also boycotted platforms, including Tera’s and Javelin’s, that did not require “name give-up.” Third, the Dealers’ IDBs, at their insistence, use a service called MarkitWire, a trade processing service, to deliver trades to clearinghouses for execution. MarkitWire is operated by MarkitSERV, controlled by former Dealer officials. Before a trade clears, MarkitWire discloses counterparties’ names to each other and gives each an opportunity to terminate the transaction. Due to “collective pressure” from the Dealers, numerous SEFs—including the largest IDB SEFs, seven of which plaintiffs name—maintain “name give-up,” “thereby effectively preventing buy-side customers from trading on them.” The Dealers have also pulled, and threatened to pull, liquidity from platforms that allow anonymous trading other than among Dealers; one interdealer SEF received heated phone calls from executives at Credit Suisse and J.P. .Morgan over the prospect of introducing trade 'anonymity. Dealers .have also threatened buy-.side customers with the “penalty box” if they attempt to trade on an all-to-all trading platform, whether operated by an IDB or an independent SEF like Tera or Javelin. Plaintiffs cite-data indicating that platforms that do not use “name give-up” see virtually no IRS activity. SAC ¶¶ 296-311; JTSAC ¶¶ 242-56.
J. Impact of the Boycott
Plaintiffs claim that the boycott of Tera, Javelin,- and TrueEx communicated that any platform giving the buy-side access to anonymous all-to-all IRS trading would be “collectively punished and strangled until it failed,” This “enforce[d] market discipline” and deterred others from- opening such platforms. Similarly, plaintiffs allege, the Dealers deterred customers from using such platforms, by withholding clearing services from those who trade on them. SAC ¶¶ 288-91; JTSAC ¶¶ 226-33.
Plaintiffs claim that the boycott has resulted in the Dealers’ controlling 70% or more of the IRS market and preventing structural changes in that market. As a result, investors pay more money for IRSs, to which no other financial instrument is fully comparable. Plaintiffs allege that a comparison of data with fixed income and equities products sold on exchanges reveals the price benefits of such transparent all-to-all trading. SAC ¶¶ 312-47; JTSAC ¶¶ 267-72.
II. Procedural History
The initial complaint in this action was filed on November 25, 2015. Dkt. 1 in No, 15 Civ. 9139. On June 2, 2016, the United States Judicial Panel on Multidistrict Litigation (“JPML”) transferred all related cases to this Court for coordinated or consolidated pretrial proceedings with the actions pending in this District. Dkt. 1. 10 The *460 cases encompassed by the JPML’s order include eases brought on behalf of a putative class of IRS investors, and the separate case brought by Javelin and Tera. On July 26, 2017, the Court held an initial conference, and stayed formal discovery. Dkt. 10 (Order No. 3). On August 3, 2016, the Court appointed Quinn Emanuel Urquhart & Sullivan, LLP, and Cohen Milstein Sellers & Toll, PLLC, as interim co-lead counsel for the putative class. Dkt. 12 (Order No. 4). On September 9, 2016, class plaintiffs, Dkt. 13, and the Javelin/Tera plaintiffs, Dkt. 14, each filed an Amended Complaint. On November 4, 2016, defendants filed motions to dismiss. Dkts. 15-20; Dkts. 123-25, 127-29, 131-34 in No. 16-MD-2704. On December 9, 2016, class plaintiffs, Dkt. 23 (“SAC”), and the Javelin/Tera plaintiffs, Dkt. 145 in No. 16-MD-2704 (“JTSAC”), filed Second Amended Complaints. On January 20, 2017, defendants moved to dismiss, through separate motions filed by the Dealer Defendants, Dkts. 24-26, ICAP, Dkts. 28-30, HSBC, Dkt. 40 & Dkt. 163 in No. 16-MD-0274, and Tradeweb, Dkts. 169-71 in No. 16-MD-2704. On February 17, 2017, the class, Dkt. 32, and Javelin/Tera, plaintiffs, Dkt. 33, filed opposition briefs. On March 24, 2017, defendants filed reply briefs. Dkts. 36-40, & Dkts. 206-08, 210, 212 in No. 16-MD-2704. On May 23, 2017, the Court heard argument on the motions. See Transcript, Dkt. 233 in No. 16-MD-2704 (“Tr.”).
III. The Motions to Dismiss: Overview and Standards
The Dealer Defendants move to dismiss plaintiffs’ Sherman Act § 1 claims on five grounds: that (1) the SACs do not state a plausible claim of an antitrust conspiracy; (2) the class plaintiffs lack antitrust standing; (3) the Commodities Exchange Act (CEA) and Dodd-Frank impliedly preclude plaintiffs’ post-Dodd-Frank claims; (4) the SAC’s pre-2012 claims are time-barred; and (5) the SAC’s pre-2013 claims do not allege an injury-in-fact. Five individual defendants—three Dealer Defendants (BNPP, HSBC, and UBS), and the two non-Dealer Defendants (Tradeweb and ICAP)—move to dismiss for failure to state a § 1 claim for reasons particular to them. 11 Defendants also move to dismiss plaintiffs’ state-law claims.
To survive a motion to dismiss under Rule 12(b)(6), a complaint must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 , 127 S.Ct. 1955 , 167 L.Ed.2d 929 (2007). A claim only has “facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 , 129 S.Ct. 1937 , 173 L.Ed.2d 868 (2009). A complaint is properly dismissed where, as a matter of law, “the allegations in a complaint, however true, could not raise a claim of entitlement to relief.” Twombly, 550 U.S. at 558 , 127 S.Ct. 1955 . For the purpose of resolving the motion to dismiss, the Court must assume all well-pled facts to be true, drawing all reasonable inferences in favor of the plaintiff. Koch, 699 F.3d at 145 . However, that tenet “is inapplicable to legal conclusions.” Iqbal, 556 U.S. at 678 , 129 S.Ct. 1937 . A pleading that offers only “labels and conclusions” or “a formulaic recitation of the elements of a *461 cause of action will not do.” Twombly, 550 U.S. at 555 , 127 S.Ct. 1955 .
There is no heightened pleading standard in antitrust cases. Concord As socs., L.P. v. Entm’t Props. Tr., 817 F.3d 46, 52 (2d Cir. 2016). Rather, at the pleading stage, plaintiffs need only “raise a reasonable expectation that discovery will reveal evidence of illegality.” Mayor and City Council of Baltimore v. Citigroup, Inc., 709 F.3d 129, 135 (2d Cir. 2013) (“Citigroup”).
IY. Plaintiffs’ Sherman Act § 1 Claim
A. Applicable Legal Principles
The Sherman Act bans “[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States[.]” 15 U.S.C. § 1 . “The crucial question in a Section 1 case is therefore whether the challenged conduct ‘stems from independent decision or from an agreement, tacit or express.’” Starr v. Sony BMC Music Ent’m’t, 592 F.3d 314, 321 (2d Cir. 2010) (quoting Theatre Enters., Inc. v. Paramount Film Distrib. Corp., 346 U.S. 537, 540 , 74 S.Ct. 257 , 98 L.Ed. 273 (1954) (alterations omitted)).
To plausibly allege a Sherman Act § 1 conspiracy, a complaint must allege “enough factual matter (taken as true) to suggest that an [illegal] agreement was made,” that is, “enough fact to raise a reasonable expectation that discovery will reveal evidence of illegal agreement.” Twombly, 550 U.S. at 556 , 127 S.Ct. 1955 . “The ultimate existence of an ‘agreement’ under antitrust law ... is a legal conclusion, not a factual allegation.” Citigroup, 709 F.3d at 135 -36 (citing Starr, 592 F.3d at 319 n.2 (“The allegation that defendants agreed to [a] price floor is obviously con-clusory, and is not accepted as true.”)).
As the Second Circuit has recognized, there are two ways, at the pleading stage, for a plaintiff “to allege enough-facts to support the inference that a conspiracy actually existed” so as to overcome a motion to dismiss. Citigroup, 709 F.3d at 136 .
First, a plaintiff may allege “direct evidence that the defendants entered into an agreement in violation of the antitrust laws.” Id. (citing In re Ins. Brokerage Antitrust Litig., 618 F.3d 300, 323-24 (3d Cir. 2010)); see also Burtch v. Milberg Factors, Inc., 662 F.3d 212, 225 (3d Cir. 2011) (direct evidence is “evidence that is explicit and requires no inferences to establish the proposition or conclusion being asserted”). “Such evidence would consist, for example, of a recorded phone call in which two competitors agreed to fix prices at a certain level.” Citigroup, 709 F.3d at 136 .
Direct evidence, however, is not required. And concrete “smoking gun” evidence of an illegal conspiracy between sophisticated actors “can be hard to come by, especially at the pleading stage.” Citigroup, 709 F.3d at 136 ; see also United States v. Snow, 462 F.3d 55, 68 (2d Cir. 2006) (“[Conspiracy by its very nature is a secretive operation, and it is a rare case where all aspects of a conspiracy can be laid bare in court ... with precision.”).
As a result, as an alternative to direct evidence, to prove a conspiracy a plaintiff may rely on indirect or circumstantial evidence, that is, “inferences that may fairly be drawn from the behavior of the alleged conspirators.” Anderson News, LLC v. American Media, Inc., 680 F.3d 162, 183 (2d Cir. 2012) (quoting Michelman v. Clark-Schwebel Fiber Glass Corp., 534 F.2d 1036, 1043 (2d Cir. 1976)); see also In re Elec. Books Antitrust Litig., 859 F.Supp.2d 671, 681 (S.D.N.Y. 2012) (“eBooks ”) (same).
A horizontal agreement among competitors, the sort of pact alleged here, is commonly based on claims of parallel *462 conduct by the alleged co-conspirators. However, as the Supreme Court held in Twombly , “alleging parallel conduct alone is insufficient, eyen at the pleading stage,” to survive a motion to dismiss. Citigroup, 709 F.3d at 136 . Rather, to plausibly allege a § 1 violation, the parallel conduct must be “placed in a context that raises a suggestion of a preceding agreement, not merely parallel conduct that could'just as well be independent action.” Twombly, 550 U.S. at 557 , 127 S.Ct. 1956 .
Twombly illustrates these principles. After deregulation, regional telephone companies had, in parallel, elected not to enter incumbent carriers’ local telephone and high-speed internet markets.' From this, the complaint inferred an agreement among these carriers to allocate markets. Upholding dismissal, the Supreme Court held that the competitors’ parallel conduct, as alleged, did not “render a’ § 1 conspiracy plausible.” 550 U.S. at 566 , 127 S.Ct. 1955 . Although such conduct was consistent with the existence of an agreement, it was also “just as much in line with a wide swath of rational and competitive business strategy unilaterally prompted by common perceptions of the market.” Id. at 554 , 127 S.Ct. 1955 . Parallel conduct by competitors that would not state a § 1 claim, the Court observed, can be the result of “coincidence, independent responses to common stimuli, or mere interdppendenee unaided by an advance understanding between the parties.” Id. at 556 n.4, 127 S.Ct. 1955 (quotation omitted). And there were sound reasons for each carrier independently to have refrained from entering an incumbent’s market. Id. at 564-69 , 127 S.Ct. 1955 . The Court cautioned: “Even ‘conscious parallelism,’ a common reaction of ‘firms in a concentrated market that recognize their shared economic interests and their interdependence with respect to price and output decisions,’ is ‘not in itself unlawful.’” Id. at 553-54 , 127 S.Ct. 1955 (quoting Brooke Grp. Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209, 227 , 113 S.Ct. 2578 , 125 L,Ed.2d 168 (1993)) (alterations omitted).
[12—14] Following Twombly, for a complaint to state a § 1 claim based on parallel conduct by competitors, it must plead facts sufficient to indicate that this conduct “flowed from a preceding agreement rather than from [defendants’] own business priorities.” Citigroup, 709 F.3d at 137-38 ; see also Twombly, 550 U.S. at 557 , 127 S.Ct. 1955 (“A statement of parallel conduct, even conduct consciously undertaken, needs some setting suggesting the agreement necessary to make out a § 1 claim[, some] further circumstance pointing to the meeting of the minds[.]”). An inference of conspiracy will not arise when the conspirators’ parallel .conduct “made perfect business sense,” Citigroup, 709 F.3d at 138 , “there are obvious alternative explanations for the facts alleged,” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 322-23 (quotation and alterations omitted), or the alleged facts “suggest competition at least as plausibly as [they] suggest anticompetitive conspiracy,” In re Elevator Antitrust Litig., 502 F.3d 47, 51 (2d Cir. 2007). However, the requirement of “ ‘plausible grounds to infer an agreement does not impose a probability requirement at the pleading stage; it simply calls for enough fact to raise a reasonable expectation that discovery will reveal evidence of illegal agreement,’ ” Anderson News, 680 F.3d at 184 (quoting Twombly, 550 U.S. at 556 , 127 S.Ct. 1955 ) (emphasis added by Anderson News), and “there may ... be ... more than one plausible interpretation of a defendant’s words, gestures or conduct.” Id. at 189-90.
Post-Twombly courts have analyzed § 1 claims based on parallel conduct by horizontal competitors by inquiring whether “plus factors” and/or other circumstantial evidence are present that, *463 along with the parallel conduct, make it plausible to infer an agreement among competitors. See, e.g., Citigroup, 709 F.3d at 137 ; Gelboim v. Bank of America, Corp., 823 F.3d 759, 781 (2d Cir. 2016). These factors describe “circumstances under which ... the inference of rational independent choice [is] less attractive than that of concerted action.” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 323 (citation omitted). The Second Circuit has identified three “plus factors” as ones that may support a plausible inference of conspiracy: “(1) ‘a common motive to conspire’; (2) ‘evidence that shows that the parallel acts were against the apparent individual economic self-interest of the alleged conspirators’; and (3) ‘evidence of a high level of interfírm communications.’ ” Gelboim , 823 F,3d at 781 (quoting Citigroup, 709 F.3d at 136 ). The Third Circuit has also identified as relevant circumstantial evidence facts “implying a traditional conspiracy,” meaning “non-economic evidence ‘that there was an actual, manifest agreement not to compete,’ which may include ‘proof that the defendants got together and exchanged assurances of common action or otherwise adopted a common plan even though no meetings, conversations, or exchanged documents aré shown.’” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 322 (citations omitted)..
B. Discussion
The SAC alleges a nine-year—from 2007 to 2016—Sherman Act § 1 conspiracy among 11 Dealer Defendants (plus affiliates) and two other entities. The JTSAC, although focused on the last four years of this period, alleges the same. Defendants argue that the Complaints do not plausibly allege a conspiracy. They argue that, once conclusory allegations are stripped away, the conduct pled largely consists of acts consistent with éach Dealer’s independent self-interest. And, they argue, there is insufficient circumstantial evidence or “plus factors” to suggest an illegal agreement.
In assessing the motions to dismiss, it is useful to divide the period covered by the § 1 claim into two parts: 2007-2012 and 2013-2016 (ending December 9,2016, when the SACs were filed). That is because the structure and nature of the IRS market changed materially in or around 2013, as a result of Dodd-Frank’s mandates; and because plaintiffs’ claims as to the nature of the conspiracy, and the supporting allegations, differ in the two periods. During 2007-2012, platforms offering anonymous all-to-all IRS trading accessible to the buy-side had not yet developed; class plaintiffs’ claim is that the defendants conspired to inhibit such platforms from coming into existence. During 2013-2016, the infrastructure for such platforms was in place and several had emerged; plaintiffs’ claim is that the defendants conspired to quash these nascent platforms, including those of Javelin and Tera.
1. 2007-2012
While plaintiffs’ theory over the entire class period is that the Dealers engaged in parallel acts in circumstances suggesting collusion and not independent pursuit of self-interest, the SAC is not explicit whether, as to 2007-2012, its claim of conspiracy is based on parallel acts, direct proof of agreement, or a combination. The Court therefore examines this period from each perspective to test whether a horizontal conspiracy has been plausibly pled.
a. Allegations of Parallel Conduct
The SAC’s main claim of parallel conduct during 2007-2012 is of parallel inaction: The Dealers are each alleged to have disfavored as a matter of self-interest, and so not to have taken steps to support, the *464 emergence of platforms enabling all-to-all exchange-based IRS trading.
Otherwise, even treating generalized claims as cognizable, the SAC alleges limited parallel conduct during this period. It alleges that the Dealers: (1) generally threatened to deny liquidity (trading volume) to IDBs that invited the buy-side to trade on their platforms, see SAC ¶¶ 160-61 12 ; (2) generally insisted on clearing IRS trades only through a Dealer-controlled platform, SwapClear, rather than pivoting business to a new product and platform, “CME Cleared Swaps,” that had longer-term potential to extend central clearing of IRS trades to the buy-side, see SAC ¶¶ 184-88 13 ; and (3) continued to practice “name give-up,” under which the buy-side customer was identified to the counterparty, see, e.g., SAC ¶¶ 292-94.
These shards of parallel conduct do not give rise to an inference of an agreement to block all-to-all trading. As in Twombly, the pleadings here supply good reason, as a matter of “rational and competitive business strategy,” 550 U.S. at 554 , 127 S.Ct. 1955 , for any individual Dealer independently to have sought to maintain the status quo and to discourage, not facilitate, all-to-all IRS exchange trading platforms from taking root. The SAC’s theory, in fact, is that such platforms presented an existential threat to the Dealers’ profit margins as market makers. See, e.g., SAC ¶28 (the Dealers “‘want[ed] desperately to preserve the status quo’ of the OTC market” and to “stop[ ] meaningful development of the market”); see also SAC ¶¶ 9, 74; JTSAC ¶ 6. It follows that each Dealer had good reason to independently discourage (e.g., in its dealings with IDBs) and not encourage (e.g., in not using a new clearing product) development of a new trading paradigm that threatened, some day, to cannibalize their trading profits. “[C]ommon economic experience, [and] the facts alleged in the complaint itself, [thus] show that independent self-interest is an obvious alternative explanation for defendants’ common behavior.” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 326 ; see also id. at 349 (where defendants are “reaping enormous profits,” it is natural for them to have “no desire to upset the apple cart”) (quotation omitted); Twombly, 550 U.S. at 568 , 127 S.Ct. 1955 (no inference of conspiracy where each defendant “liked the world the way it was” and was “sitting tight, expecting [its] neighbors to do the same thing”).
In three respects, the inference of collusion from the parallels pled, in fact, is far less plausible than in Twombly.
First, the parallel activity in Twombly involved the ultimate act of refraining to compete: The regional telephone carriers *465 were alleged to have refrained from entering one another’s markets as competitors. In contrast, the parallel behavior pled here implicates narrower business practices (e.g., whether to use a new clearing product), not the ultimate decision whether to compete or refrain.
Second, in Twombly, the decisions by the phone companies to forego competing in each other’s markets were sharply pled. In contrast, here, as noted, plaintiffs’ claims here of parallel practices during 2007-2012 are largely pled generally and collectively.
Third, in Twombly, the alleged agreement involved foregoing a live opportunity to compete. In contrast, the alternative trading environment to which class plaintiffs claim to have aspired not only did not exist in 2007-2012—based on the pleadings, the critical infrastructure necessary for it to take root was not yet in place. The SACs acknowledge that central clearing did not develop until 2013, when Dodd-Frank’s mandates made it compulsory for most IRS trading. And without it, anonymous all-to-all exchange trading was impossible: For any trade, a Dealer had to face its counterparty, so as to assess creditworthiness, manage risk, and consult any ISDA that set the background terms for trades between the parties. See, e.g., SAC ¶¶ 71, 91, 95; JTSAC ¶¶68, 88, 92. The advent of central clearing in 2013, however, eliminated the need for these trade-specific inquiries, and thus enabled anonymous exchange trading: The clearinghouse became each side’s counterparty; assured creditworthiness by requiring participants to have posted advance collateral; and assured background terms and conditions for trades. 14 But in the preceding years when central clearing—the internal combustion engine of anonymous exchange trading—was as-yet undeveloped, it is simply less plausible to infer a collusive agreement to block such trading from the Dealers’ limited parallel actions. Before Dodd-Frank made this vital infrastructure a looming reality, there would have no urgency for collective action to block all-to-all exchange trade from emerging. 15
b. Alleged Direct Evidence of Conspiracy: Project Fusion
Presumably given the sparse parallel acts in this period, the SAC makes the centerpiece of its § 1 claims during 2007-2012 an episode of alleged actual collaboration. It involves “Project Fusion,” in which most Dealers, in 2007, acquired a controlling stake in Tradeweb. Plaintiffs claim that Project Fusion is direct evidence of a conspiracy.
As noted, the SAC alleges that the Dealers, which had founded Tradeweb in 1998, repurchased it from Thomson in late 2007. Tradeweb had developed a dealer-to-client RFQ platform in which buy-side customers traded consistent with the day’s norm: They received and chose among non-binding quotes from Dealers. The SAC alleges that the Dealers feared that Tradeweb might expand to introduce all-to-all trading to the IRS market. Therefore, the SAC alleges, the Dealers devised a scheme, “Project Fusion,” using their collective *466 leverage over Thomson, to repurchase and take control of Tradeweb, so as to assure that, its platform would remain an RFQ platform and not be used for all-to-all trading. The SA(3 also alleges that the Dealers, in the 2007. press release announcing their investment, concealed their majority control of Tradeweb and their aim. of steering the Tradeweb platform away from all-to-all trading.
In one obvious respect, the SAC’s allegations as to. “Project Fusion” bolster the § 1 claim. These allegations establish in-terfirm communications, and on the same subject area (IRS trading platforms) as the alleged conspiracy. The SAC alleges collaboration among Dealers in acquiring control of Tradeweb. See SAC ¶¶ 112-14. And it alleges in detail the longtime membership on Tradeweb’s board of many Dealers, and that affiliates of Dealers were Tradeweb officers. See SAC ¶¶ 126-42. Had there been meaningful parallel conduct by the competitors during this period, these inter-firm communications would have been a “plus factor” supporting the inference that this conduct resulted from an agreement.
As purported direct evidence of a § 1 conspiracy, however, the SAC’s pleadings as to Project Fusion fall short, for two independent reasons.
First, the SAC’s factual allegations of an agreement to terminate a plan by Tradew-eb to open an all-to-all electronic platform for IRS trading are at best inferential, rather than explicit. They are a far cry from the illustration of direct evidence of a § 1 conspiracy—a recorded phone call in which competitors agreed to fix a price— that the Second Circuit has given. See Citigroup, 709 F.3d at 136 ; see also Burtch, 662 F.3d at 226 (to qualify as direct, evidence must be so explicit as to “require[] no inferences to establish the proposition or conclusion being asserted;” plaintiffs allegations, however, failed to “specify a time or place that.any actual agreement to fix. credit terms occurred, nor .do .they- indicate that any particular individuals .., made such an agreement”); In re Ins, Brokerage Antitrust Litig., 618 F.3d at 324 n.23 (“a. document or conversation explicitly manifesting the existence of the agreement in question” is an example of direct evidence).
The SAC lacks any such allegations as to Project Fusion. It does not allege, for example, a communication on a date in 2007 in which distinct persons agreed to put on ice Tradeweb’s plan for an all-to-all IRS exchange. On the contrary, the SAC does not.cite any evidence supporting its critical, background premise—that Tradeweb ever, had such a plan. The SAC’s claim that Tradeweb was “planning” ,in 2007 to introduce such a platform, which “plan” the Dealers then sought to subvert, SAC ¶¶ 16, 111, is stated as a conclusion. It- is not supported by well-pled facfs. Nor does the SAC allege anything specific.that Tra-deweb did—between becoming majority-owned by the Dealers in 2007 and opening up a SEF for all-to-all IRS trading in 2013 alongside Tera, Javelin, . TrueEx- and Bloomberg—that furthered the alleged conspiracy.
Far from qualifying as direct evidence of a § 1 conspiracy, the SAC’s lengthy allegations as to Project Fusion largely consist of conclusory allegations and inferences. These include as to why the Dealers invested alongside Thomson in Tradeweb, a financial technology company that builds platforms for fixed-income and derivative' products; why, in the transaction, the reconstituted Tradeweb entities were given certain names; what defendants’’ intentions were in formulating the press release about the 2007 investment; and why the Dealers in 2007—a year before the financial crisis and’ three years before Dodd-Frank mandated eventual central clearing—viewed Tradeweb as a serious threat *467 to morph into a platform for all-to-all trading. See generally SAG ¶¶ 100-60.
Second, even assuming a well-pled agreement among Tradeweb’s Dealer owners to terminate a plan to open an all-to-all IRS trading platform, the SAC does not plead facts under which that agreement would be unlawful. A plaintiff alleging a § 1 violation may allege either a per se unlawful agreement or one that is illegal under the “rule of reason.” Per se liability is limited to “agreements whose nature and necessary effect are so plainly anti-competitive that no elaborate study of the industry is needed to establish their illegality[]” Nat’l Soc’y of Prof'l Eng’rs v. United States, 435 U.S. 679, 692 , 98 S.Ct. 1365 , 55 L.Ed.2d 637 (1978). As to these categories of restraints, experience has enabled courts to “predict with confidence that the rule of reason will condemn it;” and therefore permits to apply “a conclusive presumption that the restraint is unreasonable.” Arizona v. Maricopa Cty. Med. Soc’y, 457 U.S. 332 , 344 & n.15, 102 S.Ct. 2466 , 73 L.Ed.2d 48 (1982); see also Anderson News, 680 F.3d at 182-83 . “Paradigmatic examples are horizontal agreements among competitors to fix prices or to divide markets;” Leegin Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877, 886 , 127 S.Ct. 2705 , 168 L.Ed.2d 623 (2007) (quotation omitted); see also Klor’s Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207 , 211-42, 79 S.Ct. 705 , 3 L.Ed.2d 741 (1959) (group boycotts are per se violations of the Sherman Act); Capital Imaging Assocs., P.C. v. Mohawk Valley Med. Assocs., Inc., 996 F.2d 537, 542-43 (2d Cir. 1993). Agreements that do not fall under per se illegality are analyzed under the rule of reason to determine whether they are an unreasonable restraint of trade. Under the rule of reason analysis, “the plaintiff bears the burden of showing that the alleged [agreement] produced an adverse, anti-eompeti-tive effect within a relevant geographic market.” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 315 (quotation omitted). Satisfying this burden includes a demonstration of defendants’ market power. Id.; see also Concord Assocs., 817 F.3d at 52-53 .
The SAC’s allegations as to Project Fusion do not fit into any category of agreement recognized as per se illegal. It alleges a decision among participating Dealer Defendants 16 as to the strategic direction of a single financial technology company which they majority-owned pursuant to a joint venture. But, viewing the operation of a legitimate joint venture as akin to that .of a single firm, modern antitrust law evaluates such joint conduct—including the creation of the joint venture itself, its business focus, its product selection, and its pricing-under the rule of reason, with the pleading requirements that standard imposes. See, e.g,, Texaco, Inc. v. Dagher, 547 U.S. 1 , 1 n.1 & 6-7, 126 S.Ct. 1276 , 164 L.Ed.2d 1 (2006) (“the pricing decisions of a legitimate joint venture do not fall within the narrow category of activity that is per se unlawful under § 1"; “[a]s a single entity, a joint venture, like any other firm, must have the discretion” to make decisions regarding the conduct of the venture); see also American Needle, Inc. v. National Football League, 560 U.S. 183, 195 , 130 S.Ct. 2201 , 176 L.Ed.2d 947 (2010); Major League Baseball Properties, Inc. v. Salvino, 542 F.3d 290, 316-18 (2008) (“MLB Properties ”); cf. Copperweld Corp. v. Indep. Tube Corp., 467 U.S. 752 ,- 772 n.18, 104 S.Ct. 2731 , 81 L.Ed.2d 628 (1984).
Plaintiffs do not cite any case in which a decision by competitors to invest in or acquire control over a business, or to direct the activities of'the business, in the context of a legitimate joint venture, has *468 been evaluated under the per se standard. And the SAC does not plead facts that remove the Project Fusion joint venture from this body of case law. It does not plead facts indicating that, after its creation, Tradeweb, the subject of the joint venture, became a horizontal competitor of the Dealer Defendants which thereafter conspired with them. And Tradeweb was not such a competitor: As alleged, it was a provider of electronic trading platforms, not a market maker. And the SAC does not adequately plead that the Project Fusion joint venture was an illegitimate shell that offered no efficiency enhancements and served only to mask concerted conduct. See, e.g., American Needle, 560 U.S. at 200 , 130 S.Ct. 2201 (“Agreements made within a firm can constitute concerted action covered by § 1 when the parties to the agreement act on interests separate from those of the firm itself, and the intra-firm agreements may simply be a formalistic shell for ongoing concerted action.”). The SAC’s allegations as to Tradeweb— including as to non-defendant Thomson’s minority-ownership of it, the Dealers’ infusion of $280 million in it, and its existence and operation from 2007 forward—would not permit such an inference. 17
That leaves the rule of reason. The SAC, however, fails to plead facts sufficient to support the conclusion that, evaluated under rule-of-reason methodology, the Project Fusion joint venture—the centerpiece of plaintiffs’ pre-2013 § 1 claim—represented an unreasonable restraint of trade. Under rule-of-reason analysis, “[t]he true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition.” Chicago Bd. of Trade v. United States, 246 U.S. 231, 238 , 38 S.Ct. 242 , 62 L.Ed. 683 (1918); see also Nat’l Soc’y of Prof'l Eng’rs, 435 U.S. at 691 , 98 S.Ct. 1355 (rule-of-reason analysis is of “whether the challenged agreement is one that promotes competition or one that suppresses competition”). The factfinder applies this analysis to the restraint “under all the circumstances of the case,” Maricopa Cty. Med. Soc’y, 457 U.S. at 343 , 102 S.Ct. 2466 , and “must ordinarily consider the facts peculiar to the business to which the restraint is applied, its condition before and after the restraint was imposed; the nature of the restraint and its effect, actual or probable,” as the “history of the restraint, the evil believed to exist, the reason for adopting the particular remedy, [and] the purpose of the end sought to be attained, are all relevant facts,” Chicago Bd. of Trade, 246 U.S. at 238 , 38 S.Ct. 242 . 18
*469 Here, however, there are no allegations in the SAC defining Tradeweb’s product or geographic market, or, within that market, defining its market share or market power. There is, in fact, no allegation that Tra-deweb had any presence, let alone power, in any market. And, vitally important, there are no allegations as to the pro-competitive benefits and anti-competitive harms of Tradeweb after the joint venture, whether in general or as to Tradeweb’s specific choices after 2007 as to which trading platforms and asset classes to pursue and which to forego.
Therefore, even assuming it adequately pled an agreement among Dealers to terminate a Tradeweb plan to open an all-to-all trading platform, the SAC does not plead facts supporting, under the rule of reason, the inference that agreement was anti-competitive so as to violate § 1. 19
In a final allegation regarding Project Fusion, the SAC claims that the Dealers and Tradeweb concealed the Dealers’ majority interest in the entity (Tradeweb NewMarkets) that housed Tradeweb’s IRS business. SAC ¶ 120. That claim proves inaccurate. As defendants point out, securities filings of Thomson, Tradeweb’s parent, disclosed in November 2007 that the Dealers who invested ip Project Fusion had obtained (1) a 15% interest in the entity responsible for Tradeweb’s “established markets” (Tradeweb Markets LLC) and (2) an 80% interest in a separate entity that would pursue asset “asset class expansion” in additional markets (Tradew-eb NewMarkets LLC). See Thomson Corp. Form 6-K (Nov. 9, 2007) (quoted in Dealer Rep. Br. 17 & n.11); see also discussion infra, § V. In any event, even if well-pled, the Dealers’ concealment of their majority stake would not itself establish an agreement in violation of § 1. It would instead be circumstantial evidence bearing on such a claim.
*470 c. Other Allegations Relating to 2007-2012
The Court néxt considers plaintiffs’ other allegations during 2007-2012 bearing on the claim of a conspiracy to violate § 1.
OTCDerivNet: The SAC alleges that, in October 2000, eight Dealers formed a new entity called OTCDerivNet; other named' Dealers joined in 2001 and 2009. The Dealers’ goal in forming the new entity, the SAC alleges, was to use it to secure control of SwapClear, an IRS clearinghouse; soon after 2000, the Dealers did so. SAC ¶¶ 177-80; During 2007-2012, the SAC alleges,’ the Dealer-affiliated board members of OTCDerivNet discussed how to “prevent or delay the buy side’s ability to clear IRS trades.” Id. ¶ 183 & n.72. And in 2008, the SAC alleges, “[m]eeting through OTCDerivNet, the Dealer Defendants agreed 'to clear only interdealer IRS trades and only on SwapClear (the entity they controlled),” a “boycott” which “starved” an “IRS product” created by CME ’ called “CME Swaps on Swap-stream.” Id. If 188.
The allegations regarding OTCDeriv-Net, like those involving Project Fusion, plead the existence of a forum for inter-Dealer communication during the alleged conspiracy. They also adequately plead that the Dealers acknowledged a shared interest in influencing the process of clearing IRS trades. But, for several reasons, the SAC’s allegations as to this one entity do not more broadly support plaintiffs. They do not buttress the claim of an inter-Dealer agreement beginning in 2007 to block all-to-all trading from emerging. And they supply an inadequate basis for plaintiffs’ ambitious thesis that defendants—as opposed to á lack of buy-side interest-are responsible for the pre-2013 absence of buy-side central clearing.
First, the Dealers founded OTCDeriv-Net in 2000, seven years before the start of the alleged conspiracy. Its existence therefore is not evidence of the alleged conspiracy. Second, as to the one action alleged to have occurred during 2007-2012, it is largely contradicted by class plaintiffs’ original complaint: Contrary to the SAC’s claim that the members of OTCDerivNet boycotted the CME product, plaintiffs initially admitted that the CME had never launched that product. See Dkt. 13, ¶ 291. The SAC is notably silént as to that point, instead obliquely alleging only that the product “swiftly failed” because of the alleged “boycott,” SAC ¶ 188. These allegations, however, are conclusory. Second, the SAC’s allegations of a boycott of clearing services accessible to the buy-side all take the form of conclusory group pleadings; the SAC does not identify a single act by a single Dealer to boycott the CME product. See id. ¶ 186 (“The Dealer Defendants viewed this as a serious threat.”); id. 187 (“The Dealer Defendants knew CME had the technical and commercial ability to offer integrated all-to-all trading and central clearing for IRS to the buy side.”); id. ¶ 188 (“The Dealer Defendants responded to this threat:by boycotting Swapstream.”). Finally, the SAC does not allege that the Dealers boycotted CME’s clearing services, just the one never-offered product. On the contrary, in an allegation inconsistent with the claim that the Dealers conspired to “prevent ... buy-side access to IRS clearing,” id. ¶ 175, the SAC alleges that, after the 2008 financial crisis, the Dealer-controlled SwapClear launched an IRS clearing product designed specifically for the buy-side. Id. ¶ 189.
Trade associations: The SAC alleges that the Dealers- belonged to, and conspired through, trade associations and related organizations. See id. ¶¶ 126, 151-57, 203, It alleges that the Dealers entered into agreements at unidentified meetings of these organizations. Such bare claims of “agreement,” however, are legal conclu *471 sions. They do not make the claim of a boycott of all-to-all exchanges in this period plausible. See Citigroup, 709 F.3d at 135-36 . And a “mere opportunity to conspire” at legitimate meetings does not support an inference that “an illegal combination actually occurred.” Capital Imaging Assocs., 996 F.2d at 545 ; see also Twombly, 550 U.S. at 567 n.12, 127. S.Ct 1955 (“belong[ing] to the same trade guild as one[’s] ... competitors” does not render conspiracy plausible); In re Musical Instruments & Equip. Antitrust Litig., 798 F.3d 1186, 1196 (9th Cir. 2015) (“mere participation in trade-organization meetings where information is exchanged and strategies are advocated does not suggest an illegal agreement”).
d. “Plus Factors” and Conclusion
Given the few well-pled allegations of parallel relevant activity among Dealers during 2007-2012, there is, arguably, no charter to inquire into the existence of the three “plus factors” identified by the Second Circuit. The SAC, as noted, instead appears to anchor its claim of conspiracy during this period on Project Fusion, which it presents, albeit incorrectly, as direct evidence of a § 1 boycott. Nevertheless, to assure a careful review- of the plausibility of plaintiffs’ claim of conspiracy, the Court analyzes these factors.
One “plus factor” is clearly present. The SAC pleads “a high level of interfirm communications,” Gelboim, 823 F.3d at 781 , including via the Dealers common ownership of TradeNet, their participation in OTCDerivNet, their participation on industry associations, and the social and professional and social interactions among executives of Dealers in this market niche. See, e.g., SAC ¶¶ 126-41, 151-58, 182-83.
But the other two “plus factors” are at best thinly pled. The SAC claims “a common motive to conspire,” Gelboim, 823 F.3d at 781 , during 2007-2012. But, while the SAC pleads that many Dealers preferred RFQ trading and viewed all-to-all exchange trading as a long-term threat to profit margins, see, e.g., SAC ¶¶ 102-105, 113, before 2013, there was no all-to-all exchange trading to boycott. And to the extent the SAC’s theory is of a'loiig-term plot to nip this mode of trading in the bud, the SAC does not (other than conclusorily) allege that—before Dodd-Frank’s mandates—central clearing, a necessary precondition for such trading, existed or was imminent or seen as inevitable. Therefore, while defendants had a long-term interest in the non-emergence of such trading, in the 2007-2012 period, on the facts pled, there was little urgency to conspire against it. 20
As to the remaining “plus factor," the SAC does not plead activity by individual Dealers, during this period, against their “apparent individual economic self-interest.” Gelboim, 823 F.3d at 781 . As to “non-economic evidence [of] an actual, manifest agreement not to compete,” In re Ins. Brokerage Antitrust Litig., 618 F.3d at 322 , the SAC does not plead it, either. The closest it comes is the Dealers’ alleged coordination in connection with acquiring control of Tradeweb. But, for the reasons *472 addressed, the SAC’s allegations as to that joint venture do not adequately plead an agreement to terminate a Tradeweb plan to initiate all-to-all exchange trading, let alone that such an agreement was illegal.
All allegations considered, the SAC therefore has not pled a plausible conspiracy among the Dealer Defendants, during 2007-2012, to block the emergence of all-to-all platforms for IRS exchange trading. There are limited well-pled allegations of parallel activity among the Dealers. There is no direct evidence of conspiracy, and the SAC’s main allegations of actual collaboration among Dealers, the Project Fusion joint venture, as pled, do not describe an illegal agreement. And the plus factors lend only light support to a conspiracy theory. As in other cases where the factual allegations did not plausibly support the inference of an agreement in violation of § 1, the SAC’s claims of such a conspiracy during 2007-2012 must therefore be dismissed as implausible. See, e.g., Twombly, 550 U.S. at 570 , 127 S.Ct. 1955 ; Citigroup, 709 F.3d at 140 ; In re Insurance Brokerage Antitrust Litig., 618 F.3d at 336 (dismissing all § 1 claims in claim of industry-wide conspiracy except narrow sector-specific allegations of bid-rigging).
2. 2013-2016
In contrast to 2007-2012, plaintiffs’ pleadings for 2013-2016 allege a recognized type of per se unlawful § 1 conspiracy: a group boycott. During this period, five platforms for all-to-all exchange trading of IRSs emerged: Tera, Javelin, TrueEx, Tradeweb, and Bloom-berg. The SACs allege that the Dealer Defendants conspired to starve the first three of these platforms of liquidity so as to destroy them—and that this boycott largely succeeded. 21
For this period, plaintiffs mainly argue that a conspiracy can be inferred from parallel conduct by the Dealers coupled with circumstantial evidence and “plus” factors indicating agreement. 22 The SACs allege the following parallel conduct:
• Parallel refusals to trade on Javelin, Tero, and TrueEX platforms: The three new entities each sought liquidity from the Dealers for their new platforms permitting all-to-all trading. The 11 Dealers (except, briefly, RBS) each refused to supply liquidity to, or to trade on, these platforms. See, e.g., JTSAC ¶¶ 148, 151, 185, 189, 223-25.
• Common excuses and vocabulary: The Dealers gave similar excuses for refusing to provide liquidity to the new platforms. For example, at separate meetings at Javelin between 2013 and 2015, senior employees at each Dealer cited “a need to conduct a never-ending legal review of the Javelin SEF rulebook, a largely standardized document already approved by the CFTC.” Multiple Dealers used the same terminology in explaining to affiliated IDBs why they would not allow these IDBs to trade on Tera. The Dealers called Tera’s platform a “Trojan Horse” and said they did not wish to let *473 Tera “off the mat.” See, e.g., id. ¶¶ 151, 154, 215.
Similar tactics at meetings with Javelin and Tera: The Dealers used meetings with Javelin and Tera to explore ways to undermine the platforms and used similar tactics at these meetings. Goldman Sachs executives used a September 2013 meeting to “grill[ ] Javelin on whether its platform had to allow all-to-all trading and to fish for the names of buy-side customers signed up for Javelin’s platform,” so as to head off these customers from using the platform. A month earlier, Morgan Stanley’s Senft had asked Javelin “for a list of buy-side customers that had expressed an interest in Javelin, as well as the contact person for each firm.” As to Tera, Goldman Sachs, Barclays, Bank of America, Credit Suisse, Citi, Deutsche Bank, and Morgan Stanley arranged meetings with Tera, ostensibly to explore trading on its platform, and at these meetings used “strikingly similar” “bait and switch tactics”: Tera “personnel would walk into the meeting expecting to meet with the head of IRS trading to discuss the bank signing up for the TeraExchange platform, but instead would be met by personnel from the bank’s strategic investment group offering to take a stake in TeraExchange itself,” allegedly with the goal of taking over and shutting down these platforms. See, e.g., id. ¶¶ 144-45, 149, 151-54, 186-88.
Parallel withholdings by affiliated FCMs of clearing services: The Dealers’ affiliated FCMs all withheld clearing services on the Javelin and Tera platforms, at the Dealers’ direction, effectively blocking market entry by these platforms. Withholding such services cost the FCMs revenue, because FCMs earn fees for each trade submitted for clearing. For example, the FCMs, citing the need for rulebook reviews, each refused to conduct pre-trade credit checks for customers on both platforms, preventing trades, despite routinely providing such checks to other platforms that did not offer meaningful anonymous all-to-all trading, including Tradeweb and Bloomberg. As to Tera: The Dealers’ affiliated FCMs—including Bar-clays, Citi, Credit Suisse, Deutsche Bank, HSBC, and Morgan Stanley— refused to clear trades outright, or quoted exorbitant fees. As to Javelin: The FCMs that refused to provide credit-checks to buy-side customers who sought to use its order book included Deutsche Bank, which refused to allow its FCM to connect to the Javelin platform, and Barclays, Goldman Sachs, and Morgan Stanley, which made “nearly identical claims ... as to the need to conduct reviews of Javelin.” See, e.g., id. ¶¶ 138-40, 162-70, 196-200.
• Parallel action towards Tera in response to its first IRS trade: On June 13, 2014, Tera conducted the first IRS trade on its platform. BNPP’s trading desk was notified of the trade by its affiliated FCM, which, in a “transgression,” had cleared the transaction. BNPP’s trading desk then contacted the parties to the transaction and “threatened them with a loss of clearing and other banking services,” including execution and general market research, if they continued to trade on Tera. On June 16, 2014, the next business day, four Dealers—BNPP, Citi, J.P. Morgan, and UBS—separately notified Tera that they would not clear trades on Tera’s platform *474 until they had conducted a review of Tera’s rulebook, a largely standardized document that the CFTC had already reviewed before giving Tera temporary SEF registration. Other Dealers later similarly cited a need for (never-completed) rulebook reviews as reasons not tp trade on Tera. As to Javelin: Barclays, Goldman Sachs, and Morgan Stanley and other Dealers each asserted a need to review its rulebook. See, e.g., id. ¶¶ 170, 204-05.
• Similar statements to Tera perso n nel: Dealers’ representatives each .“told personnel at TeraExchange . that.its platform would never succeed.” See, e.g., id. ¶ 195.
• Similar pressure applied to customers: Dealers, including Citi and Goldman- Sachs, pressured existing customers not to trade on Javelin or Tera, and penalized buy-side entities caught trading on- these platforms. - See, e.g., id. ¶¶ 173-75, 214.
• Similar clearing-fee differentials: Dealers, including Bank óf America, Barclays, BVPP, Credit Suisse, and ,J.P. Morgan, quoted much higher different clearing fees for customers who sought to trade on the Javelin and Tera platforms than for .clearing on Dealer-friendly platforms., See, e.g., id. ¶¶ 201, 231-32.
• Similar treatment of smaller IDBs: Dealers refused to consent to various smaller IDBs’ use of Tera, and thereby -blocked Tera from giving these IDBs access to SEF services. See, e.g., id. ¶¶ 213-16,
• Parallel adherence to “name give-up”: Dealers: insisted in the practice of “name give-up,” requiring the disclosure of each swap counterparty’s identity to the other, and imposed this practice on IDBs, enabling Dealers to prevent buy-side customers from trading on the IDBs’ electronic platforms. A trade-processing- entity called MarkitSERV, operated by former executives of Goldman Sachs .and Deutsche Bank, facilitated “name give-up”: The Dealers’ IDBs sent trades to its MarkitWire service before they were cleared, and Mark-itWire then shared the counterparties’ names with each other. When an interdealer SEF operated by GFI stated in 2014 that it intended to allow anonymous trading, GFI received heated phone calls from executives at Credit Suisse and J.P. Morgan, causing GFI to reverse course. Another SEF, Tradition, publicly attributed its similar decision to pressure from dealers. See, e.g., id. ¶¶ 19, 234-35, 242-47, 260-62, 332.
• , Common direction of Tradeweb: The Dealer Defendants caused Tra-deweb, which they jointly controlled and which was- capable of launching an anonymous all-to-all trading platform, not to do so. See, e.g., id. ¶¶ 23, 312-13.
These allegations of parallel conduct, viewed collectively and in conjunction with other pled facts reviewed below, make plausible the inference of a § 1 conspiracy among Dealers to boycott the three new platforms. That is so even discounting as worthy of less weight the SACs’ collective allegations about “Dealer Defendants” that lack allegations about a particular Dealer. Importantly, the allegations concerning 2013-2016—unlike those for 2007-2012— are not limited to isolated subsidiary acts. They include the core claim that the. Dealers refused to do business with the new all-to-all platforms. And the SACs’ claim that these refusals resulted from a concerted plan to stop these platforms from gaining traction, as opposed to isolated decisions by individual Dealers, is but *475 tressed by the allegations of subsidiary parallel acts, practices, and locutions.
At the threshold, the Dealers are correct that—standing alone—their- collective refusal to do business on the new platforms would not support inferring a 'conspiracy. There is a “natural explanation,” Twombly, 550 U.S. at 568 , 127 S.Ct. 1955 , consistent with unilateral action, for the Dealers’ decisions not to supply liquidity to Javelin, Tera, and TrueEx, As the SACs plead, the existing RFQ mode of trading -with the buy-side was highly profitable. All-to-all exchange trading, however, threatened to slash the Dealers’ margins by “billions of dollars” by disintermediating them. See SAC ¶ 5, 102-03, JTSAC ¶¶ 14, 275. Each Dealer’s decision to avoid the startup platforms, like the decision by each phone company in Twombly not to compete in new markets, is, in and of itself unremarkable. Considered alone, it is not—at all-suggestive of conspiracy. See, e.g,, Williams v, Citigroup, Inc,, No. 08 Civ. 9208 (LAP), 2009 WL 3682536 , at *4 (S.D.N.Y. Nov. 2, 2009) (alleged conspiracy' among investment banks to boycott new financing structure that “threatened] [banks’] positions” in derivative markets not plausible; conduct suggests not .“a wide-ranging conspiracy but rather unilateral action among the [banks], each of whom wants to preserve its own market position”); In re Ins. Brokerage Antitrust Litig., 618 F.3d at 349 (natural for defendant who is “ ‘[r]eaping enormous profits” to have “no desire to upset the apple cart’” (quoting Twombly, 550 U.S,.at 568, 127 S.Ct. 1955 )). 23
Problematic for the Dealers, however, are the allegations of other, common behavior that is less easily explained as-unilateral action. Most telling are the events alleged on June 16, 2014, the first business day after Tera’s initial IRS trade. That day, four Dealers (BNPP, Citi, J.P. Morgan, and UBS) each separately contacted Tera. Each told Tera that it would not clear trades on Tera’s platform until it had conducted a review of Tera’s rulebook. This suggests coordination. Even assuming that the Dealers independently knew of Tera’s initial trade as opposed to having been alerted to it by BNPP as the SACs allege, 24 that four Dealers called Tera the next business day, and made the identical demand of Tera (to audit its rulebook) as a condition for clearing trades, is improbable *476 enough to support an inference of collaboration. That inference is strengthened by the SACs’ well-pled allegation that the Dealers’ interest in Tera’s rulebook was pretextual. They allege that (1) the Tera rulebook had already been audited by the CFTC, which had provisionally approved Tera’s platform, and (2) despite their expressions of interest in the rulebook, no Dealer ever completed this supposedly important audit.
Other parallel behavior supports an inference of coordinated conduct to put roadblocks in the path of the new platforms. These include: causing affiliated FCMs to deny them pre-trade credit checks and clearing services; scheduling meetings with Tera and Javelin with the ostensible goal of exploring trading but using them to extract customer names and/or to probe buying out the new entrants; using the bogus claim to require a rulebook audit to explain not doing business with Javelin and Tera; pressuring existing customers not to trade on Javelin or Tera and penalizing buy-side entities caught doing so; blocking smaller IDBs from using Javelin and Tera; using a common invasion metaphor to describe Tera (a “Trojan Horse”) and a common wrestling idiom to describe their goal towards it (not to let it “off the mat”); insisting on “name give-up” as an ostensible means to enforce the boycott, including as facilitated by MarkitWire; and telling Tera it would never succeed.
To be sure, none of these practices, acts, or locutions are illegal, inherently irrational, or self-destructive. Any one, if engaged in by multiple Dealers, could result from unilateral decisions. But, viewing these areas of symmetry in combination, the inference of communication and coordination among Dealers with the shared goal of grinding down the new platforms is entirely plausible. To put the point differently, each Dealer’s independent interest in maintaining the status quo would explain each’s decision not to supply liquidity to Javelin or Tera. But it does not follow from that shared interest that Dealers would use similar stylized stratagems to blunt the emergence of these newcomers. For a Dealer uninterested in doing business with the new platforms, the obvious alternative would have been to “just say no.”
Of the three “plus factors” identified by the Second Circuit, two lend further support to the inference of a conspiracy.
First, the SACs allege a common motive to conspire. It was to preserve the “profit center” supplied by maximal use of non-anonymous RFQ trading with the buy-side. See, e.g., JTSAC ¶ 14. A conspiracy, if successful, would assure that the new platforms were starved of liquidity; there was otherwise a risk that enough Dealers would participate to give the new platforms enough sufficient liquidity to be viable. See, e.g., Gelboim, 823 F.3d at 781-82 ; In re Credit Default Swaps Antitrust Litigation, No. 13-MD-2476 (DLC), 2014 WL 4379112 , at *10 (S.D.N.Y. Sep. 4, 2014) (“In re CDS”) (“no single [defendant] could prevent exchanges from emerging, but all [defendants] would profit from such prevention”).
Second, the SACs allege a high degree of interfirm communications. See Apex Oil Co. v. DiMauro, 822 F.2d 246, 264 (2d Cir. 1987). They allege extensive communications among high-level officials at Dealers with responsibilities for IRS and/or overall swaps trading, including among members of strategic investment groups; monthly meetings among the heads of the Dealers’ trading desks; communications among their clearing personnel; common participation in trade associations; and informal meals and other gatherings. The SACs also reflect that officials involved in IRS trading sometimes switched employment from one Dealer to another, tying the firms closer. Dealer executives’ common *477 service on Tradeweb’s boards, finally, supplied another opportunity for communications among relevant Dealer personnel— and in a forum in which discussion of competing platforms like Javelin and Tera might naturally arise.
The third “plus factor”—actions against defendants’ self-interest—only marginally, at best, enhances the claim of a conspiracy. The SACs do allege that the Dealers caused their FCM affiliates to forego fees when they refused to clear trades on the new platforms. See, e.g., JTSAC ¶ 137. But the focus on FCMs’ profitability is myopic. Plaintiffs’ overarching allegation is that preventing the all-to-all IRS trading platforms from taking root enriched the Dealers by preserving their wider spreads and profit margins on IRS trading. Plaintiffs do not claim that foregone FCM fees approached, let alone exceeded, the profit margins preserved by squelching the new platforms. Each Dealer’s overall interest therefore lay in aborting the new platforms. A Dealer was not acting against its individual self-interest in directing the FCM not to act to fortify the new platforms.
Finally, other alleged incidents and statements by Dealer personnel circumstantially support the conspiracy claim. Four examples are illustrative.
First, Morgan Stanley’s Senft asked that Javelin’s non-disclosure agreement be modified to allow one Dealer to discuss Javelin with the others. See id. ¶ 149. Senft’s request, to which Javelin agreed, supports the inference that the Dealers discussed Javelin among themselves.
Second, on August 6, 2013, Javelin personnel gave Goldman’s Smith

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/7244183. Public record. Not legal advice.