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LME set to defend itself in 3-day trial in London over nickel chaos from last year’s trading freeze
- The HKEX-owned bourse faces lawsuits from US hedge fund Elliott Associates and quantitative investing firm Jane Street Global Trading
- The trial comes 15 months after the bourse suspended trading and cancelled nickel trades following a short squeeze in March 2022
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Chad Brayin London
The London Metal Exchange (LME) is preparing to defend itself in court on Tuesday, more than a year after it was forced to suspend nickel trading following a short squeeze that threatened to destabilise the global market in March 2022.
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US hedge fund Elliott Associates and quantitative investing firm Jane Street Global Trading have sued the 146-year-old bourse in London, saying its actions to stem the chaos favoured some clients over others and violated their rights under the European Convention on Human Rights.
“The LME maintains that Elliott’s and Jane Street’s grounds for complaint have no merit and are based on a fundamental misunderstanding of the situation on 8 March 2022 and the decisions taken by the LME,” an LME representative said. “All the actions taken on 8 March were lawful and made in the interest of the market as a whole.”
The case will be heard before two judges in the UK High Court over three days this week. Elliott is seeking US$456 million in damages, while Jane Street is seeking US$15.3 million.
The trial comes just over 15 months after the nickel market descended into chaos in March of last year as the metal’s price soared more than 270 per cent over a three-day period following Russia’s invasion of Ukraine, triggering nearly US$16 billion in margin calls.
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The rapid price movement squeezed dozens of short-sellers, including the world’s largest stainless steel producer, Tsingshan Holding Group of China.
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