⚖ Oral Arguments, with Context

The Fifth Circuit reviews a contested settlement over Charles Schwab's acquisition of TD Ameritrade. Individual investors claimed the merger reduced competition in the market for retail customer orders. Their complaint was not simply that stock prices fell. It was that reduced competition left customers with less favorable trading prices and rebates. The business model matters. Brokers can receive payments from market makers for routing customers' buy and sell orders to them. That is payment for order flow. The investors claimed that, after the merger, less of the benefit reached customers. The Clayton Act prohibits acquisitions whose effect may substantially lessen competition; these allegations were not a trial finding that Schwab violated that law. After discovery and mediation, the parties agreed to a settlement covering roughly twenty-five million current brokerage customers. It calls for an antitrust compliance program designed with a consultant, rather than breaking up the merged business. Ordinary class members receive no cash distribution. The named plaintiffs receive separate payments. Members were not given an option to opt out of this mandatory class. The district judge approved the settlement and eight and a quarter million dollars in attorney's fees, payable by Schwab. The objectors challenging approval include Iowa and a customer representing himself. They will question the program's uncertain benefits, the fees, and the effect on customers' ability to pursue damages together. The original plaintiffs and Schwab will defend the agreement as a valuable compromise and emphasize that absent class members' individual damages claims are not released. Formal preservation of those claims and the practical ability to pursue them are different issues in this argument. The court first turns to standing: the required legal stake in federal litigation, involving a concrete injury traceable to the challenged conduct that the requested relief can redress. It will examine Iowa's ability to appeal and the named customers' ability to seek prospective relief. The Class Action Fairness Act requires notice to appropriate government officials; how that bears on Iowa's participation is disputed. For the fee discussion, a lodestar calculation starts with reasonable hours multiplied by reasonable hourly rates. The dispute includes whether the judge properly assessed the results obtained, not just the lawyers' time. Eric Wessan will present Iowa's challenge first.

Corrente v. The Charles Schwab Corporation (No. 25-40774) — U.S. Court of Appeals for the Fifth Circuit, argued October 23, 2026.