The London Metal Exchange (LME) has blasted a lawsuit against its handling of last year’s nickel price surge which led to a trading suspension as having ‘no merit’ ahead of a three-day court battle starting tomorrow.
The 146-year-old exchange is being sued by two trading firms, Elliott Associates and Jane Street Global Trading, who argue it unlawfully cancelled nickel trades during a chaotic episode on March 8, 2022.
Frantic: The exchange is being sued by two trading firms, who argue it unlawfully cancelled nickel trades during a chaotic episode on March 8, 2022
The LME acted after the nickel price more than doubled to over $100,000 per ton, prompting the exchange to suspend trading in the metal and void that day’s transactions.
The exchange said it acted to restore calm and avoid several clearing houses going into default, which would have caused ‘significant and systemic damage’ to metal markets.
An LME spokesman added that the complaint was based on ‘a fundamental misunderstanding’ and that all decisions were ‘lawful and in the interest of the market’.
Elliott and Jane Street argued the LME’s move had breached its own policies, favoured some traders and violated their right to ‘peaceful enjoyment’ of possessions.
