A second class-action lawsuit was filed against Cusip Global Services (CGS), the American Bankers Association (ABA), S&P Global, and FactSet for alleged violations of the Sherman Antitrust Act and business practice laws in New York and Connecticut, where FactSet is based, as well as breach of contract.

The suit, filed in the Southern District of New York, names Hildene Capital Management, a Connecticut-based asset manager focused on credit, as a plaintiff. Law firm Wollmuth Maher & Deutsch, which specializes in capital markets and securities law among other areas, is representing Hildene.

The complaint alleges that, for years, the defendants conspired to restrain trade in the financial instruments identifiers market to extort supra-competitive fees from end users. It also claims that the Cusip numbering system, which underpins virtually all stock and bond transactions in the US, gave S&P, and now FactSet, “monopoly power over financial identifiers” in violation of sections 1 and 2 of the Sherman Antitrust Act. In addition to that allegation, the suit claims that the quartet of companies also violated sections of the New York General Business Law and the Connecticut Unfair Trade Practices Act. Hildene and its legal representation “demand” a trial by jury.

A representative for S&P Global declined to comment. A rep for FactSet could not be reached for comment. A rep for the ABA referred WatersTechnology to CGS.

“For more than 50 years, the Cusip system has delivered transparency, efficiency, and reliability to the global capital markets. Market participants value and appreciate the many benefits of the tested Cusip system as delivered by Cusip Global Services every day. We believe strongly that the allegations are without merit, and we intend to defend our position vigorously,” a representative for CGS said in a statement to WatersTechnology.

The second lawsuit comes on the heels of a class action filed March 4 on behalf of broker-dealer Dinosaur Financial, asset manager Swiss Life Investment Management Holding, also against all four companies. The earlier suit alleges violations of the Sherman Antitrust Act and the Clayton Act by engaging in anti-competitive conduct and the US Copyright Act for charging hefty licensing fees to use Cusip numbers. The Cusip standard is owned and copyrighted by the ABA, while operated by CGS and its owner.

In a blockbuster deal announced in December 2021, FactSet acquired CGS from S&P, its operator for more than 50 years, for nearly $2 billion. The European Commission had previously stipulated that S&P divest Cusip as part of its ongoing merger with IHS Markit.

The identifier has long ruffled market participants’ feathers by charging a fee from institutions and data vendors alike, for each use of an individual 9-digit Cusip number. An end-user licensing the Cusip numbers of more than 40,000 securities throughout four or more business lines in three or more regions, would potentially incur $477,750 in fees. Since CGS was established in 1968, the majority of revenue and fees had gone to S&P, while a minority royalty was paid back to the ABA on each Cusip contract inked. It’s understood that the structure has not yet changed under FactSet, which closed on its acquisition on March 1.

It’s unclear how the competing suits, which are both requesting trials by jury, could affect each other or whether other similar suits will be filed.

“There are so many people who want this to end, and because the issue is so esoteric, no one thinks anyone else understands the details. These factors have created an ‘everyone for themselves’ situation,” says Dale Homburg, chief technology officer at LeafHouse Financial, an investment adviser that provides fiduciary services in the retirement industry, and InvestGrade, an investment technology company owned by LeafHouse.

The new suit repeatedly references a competing standard to Cusip known as the Financial Instrument Global Identifier, or the Figi. The Figi is an alphanumeric, free-to-use financial instrument identifier that was developed by Bloomberg and adopted by the Object Management Group, a standards consortium, in 2014. Bloomberg continues to be the registration authority and one of two certified providers of the Figi under the OMG.

In September 2021, the Figi was recognized as an official US standard, the second after only Cusip, by the Accredited Standards Committee X9, a non-profit organization endorsed by the American National Standards Institute and which is responsible for developing standards for the financial services industry. However, the second suit alleges that CGS, S&P, the ABA, and FactSet “acted together to exclude the Figi to protect S&P’s monopoly and exert their influence over X9 to ensure Cusip remains the standard for financial instruments identifiers.”

A spokesperson for Bloomberg declined to comment.