On Friday, three CME traders filed a lawsuit against CME Group Inc. (CME) alleging the exchange sold high frequency trading (HFT) access to order info providers ahead of other market participants. ?
According to a Bloomberg story, three former financial futures CBOT floor traders allege in their complaint that from 2007 until the present, CBOT?and CME started allowing letting high-frequency traders to peek ?at all orders to buy and sell futures contracts before they were reflected? to the remainder of the market.
This action took place ?before the person or entity entering the buy or sell order received confirmation that their order was received — in other words before anyone other than the HFTs were privy to this information,? said the plaintiffs.
Their attorney, Tamara de Silva,?is looking for class-action status and has said the traders haven’t been inspired by Michael Lewis’s much-discussed HFT book, “Flash Boys” but felt “vindicated” by it.?
CME has said its plans to fight the lawsuit and released the following statement on Sunday, “The suit is devoid of any facts supporting the allegations and, even worse, demonstrates a fundamental misunderstanding of how our markets operate. It is sad when plaintiffs’ lawyers bring a suit based on a desire for publicity, and in the rush to file a suit fail to undertake even the most basic effort to determine if there is any basis for their allegations. The case is without merit, and we intend to defend ourselves vigorously.”
The case is Braman v. CME Group Inc., 14-cv-2646, U.S. District Court, Northern District of Illinois (Chicago).