In Mayor and City Council of Baltimore et al. v. Citigroup Inc. et al., Second Circuit Court of Appeals ruled against a class of auction-rate securities investors and in favor of UBS AG and other top banks, finding that the banks’ simultaneous abandonment of the $330 billion ARS market before the financial crisis was a legitimate business decision. Plaintiffs sued USB AG, Bank of America Corp, Goldman Sachs Group Inc., and other banks, claiming that in 2008, shortly before the financial crisis, the banks stopped placing cover bids at ARS auctions, thereby allowing the market to collapse. In January 2011, a New York federal judge dismissed the plaintiffs’ claims. Second Circuit affirmed this decision, holding that the banks’ decision to leave the ARS market made perfect business sense because most market participants were waiting for the inevitable death spiral of ARS auctions. According to the court, in such an environment it is expected that once the auction failures reached a critical mass, the banks would exit the market very quickly. In its decision, the court also relied on Bell Atlantic Corp. v. Twombly, which found that plaintiffs alleging violations of the Sherman Act must show evidence that the defendants reached an anti-competitive agreement rather than merely engaged in “parallel conduct.” According to the Second Circuit, there was no evidence of an actual conspiracy among the banks in this case.