Glencore reaches $9.85 million zinc rigging settlement in New York
3:56 pm Monday, July 26th, 2021
By Jonathan Stempel
NEW YORK (Reuters) – Glencore Plc agreed to pay $9.85 million to resolve a private U.S. antitrust lawsuit accusing two units of the Anglo-Swiss mining company of trying to monopolize the market for zinc, driving up its price.
The preliminary settlement disclosed in a Friday night filing with the U.S. District Court in Manhattan would resolve litigation that began in May 2014. It requires approval by U.S. District Judge Paul Engelmayer.
Zinc purchasers accused U.S.-based Glencore Ltd and Pacorini Metals USA Inc of conspiring from September 2010 to February 2016 to ensure long queues for physical zinc, or Special High Grade zinc, at warehouses licensed by the London Metal Exchange.
They said this allowed Glencore to receive higher storage fees and command increased premiums when selling zinc.
Glencore did not immediately respond on Monday to a request for comment. It has denied wrongdoing.
Zinc is used to coat steel to protect against corrosion and is also used in batteries, castings and alloys such as brass.
The U.S. Geological Survey said zinc accounted for 7% of the country’s $28.1 billion of metal mine production in 2019, trailing only gold, copper and iron ore.
Another federal judge in 2016 dismissed related claims by the zinc purchasers against Goldman Sachs Group Inc and JPMorgan Chase & Co.
The case against Glencore was put on hold for more than two years, until the federal appeals court in Manhattan in August 2019 revived similar price-fixing claims by aluminum purchasers against Glencore, Goldman and JPMorgan.
Lawyers for the plaintiffs led by Oklahoma Steel and Wire Co, Iowa Steel and Wire Co, Southwestern Wire Inc and Jasper Materials Inc said the zinc settlement was “substantively fair” and followed more than three months of negotiations.
(Reporting by Jonathan Stempel in New York; Editing by Marguerita Choy)
