Doyle Lowther LLP, together with co-counsel, has submitted its amended complaint alleging the Moore Capital funds, MF Global, and certain of their employees engaged in a continuing and systemic fraud in the platinum and palladium futures and spot markets.
Plaintiffs allege for a period of years, Moore Capital and MF Global would place large “bang the close” close trades within just minutes of the platinum and palladium market close, with the express purpose to artificially drive prices higher on the NYMEX futures and spot markets. Moore Capital and MF Global placed very large trades, which had the intended effect of artificially driving the market higher.
This fraud injured future and spot market participants, who paid grossly inflated prices on the platinum and palladium markets. Plaintiffs allege:
Defendants’ blatantly manipulative trades were not merely large buy trades. They were also large “bang the close” trades that impacted the closing price. By intentionally paying and buying at a high price, the Moore Defendants also directly and automatically caused the closing or settlement price to be higher than it otherwise would have been. This is because the closing or settlement price is a volume-weighted average price. By uneconomically calculating and making their buy transaction at a higher price rather than at the cheapest available prices, the Moore Defendants automatically and necessarily caused uneconomic and manipulative increases in such volume-weighted average price to higher levels than economic behavior would have produced.
The Commodities Future Trading Commission fined defendant Moore Capital $25 million, and fined Moore Capital portfolio manager Christopher Pia $1 million and imposed permanent trading restrictions, for their participation in the illegal trading. The fraud and antitrust litigation currently is pending in the United States District Court for the Southern District of New York, In re Platinum and Palladium Commodities Litigation, No. 10 civ 3617 (WHP).
Doyle Lowther serves as class counsel for the physical subclass of platinum and palladium spot traders.