UK Court Dismissed Hedge Funds Lawsuit Against London Metal Exchange to Disclose Documents for Nickel Trades Suspension & Cancellation, Other Lawsuits Pending Including $15 Billion Jane Street & $51 Billion Elliot Management
29th December 2022 | Hong Kong
A United Kingdom (UK) court in London has dismissed a hedge fund lawsuit against London Metal Exchange (LME) to disclose documents including transcripts & meeting notes for LME nickel trades suspension & cancellation in March 2022. The hedge funds (AQR Capital Management, Winton Capital Management, Capstone Investment Advisors, Flow Traders, DRW Commodities) had filed the lawsuit to access the documents that will help them to evaluate their LME’s responsibility and possible liabilities, which have caused the hedge funds to suffer significant losses after the LME nickel trades suspension & cancellation in March 2022. Other lawsuits pending includes $15 billion Jane Street suing for $15.3 million & $51 billion Elliot Management suing for $456 million. The hedge funds (AQR Capital Management, Winton Capital Management, Capstone Investment Advisors, Flow Traders, DRW Commodities) has the right to appeal within 21 days. London Metal Exchange (LME) is a subsidiary of Hong Kong Exchange Group (HKEX).
“ UK Court Dismissed Hedge Funds Lawsuit Against London Metal Exchange to Disclose Documents for Nickel Trades Suspension & Cancellation, Other Lawsuits Pending Including $15 Billion Jane Street & $51 Billion Elliot Management “
Hong Kong Exchange Statement
HKEX: “As explained in LME Notice 22/057 published on 10 March 2022, during 7 March 2022 (UK time), significant upward price movements were observed in the nickel market. However, the LME considered that trading activity up to and including close of trading that evening had been orderly. In the early hours of 8 March 2022 (UK time) nickel prices then increased dramatically over a short period of time. After consultation with LME Clear, the LME took the decision to suspend trading in all nickel contracts with effect from 08:15 UK time and to cancel all trades executed on or after 00:00 UK time on 8 March 2022.
This decision to suspend trading was taken because the nickel market had become disorderly. Cancellations were made retrospectively to take the market back to the last point in time at which the LME could be confident that the market was operating in an orderly manner. It should be stressed that the LME always acted in the interests of the market as a whole. LME nickel trading later resumed on 16 March 2022 on all LME execution venues. The claim seeks to challenge the decisions giving effect to and maintaining the cancellation of the Claimants’ alleged trades in nickel contracts executed on or after 00:00 UK time on 8 March 2022. The Claimants have alleged that this was unlawful on public law grounds and/or constituted a violation of the Claimants’ human rights. The amount claimed by the Claimants is US$456,391,500. The LME management is of the view that the claim is without merit and the LME will contest it vigorously.”
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