JPMorgan reaches $15.7M settlement in spoofing case

Several months after it became clear that the parties in the JPMorgan treasury futures spoofing case had reached a settlement, a proposed settlement order of was filed with the New York Southern District Court.

The documents, submitted at the Court on September 22, 2021 and seen by FX News Group, confirm that plaintiffs Charles Herbert Proctor, III, Synova Asset Management, LLC, Robert Charles Class A, L.P., Thomas Gramatis, Budo Trading LLC, Kohl Trading LLC, M & N Trading L.L.C., Port 22 LLC, and Rock Capital Markets LLC move under Federal Rule of Civil Procedure 23 for preliminary approval of a class action settlement with Defendants JPMorgan Chase & Co., J.P. Morgan Clearing Corp. (now known as J.P. Morgan Securities LLC), J.P. Morgan Securities LLC, and J.P. Morgan Futures, Inc. (now known as J.P. Morgan Securities LLC).

Let’s recall that this is a class action alleging JPMorgan violated the Commodity Exchange Act, 7 U.S.C. §§ 1 et. seq. (CEA), and the common law by intentionally manipulating the prices of U.S. Treasury futures contracts and options on those contracts traded on United States-based exchanges from April 1, 2008 through January 31, 2016.

Specifically, the plaintiffs alleged that JPMorgan utilized a manipulative technique called “spoofing,” which involved purposefully placing orders with the intent to cancel prior to execution to send false and illegitimate supply and demand signals to an otherwise efficient market.

The parties have reached an agreement to settle this action in exchange for a $15,700,000 cash payment to be made for the benefit of the Settlement Class and the dismissal of all claims against the defendants.

Class Plaintiffs and JPMorgan reached this settlement after months of hard-fought, arm’s- length negotiations supervised by a mediator, the exchange of substantial amounts of transaction data and other information, extensive presentations on liability and damages, and months of additional discussions regarding specific Settlement terms. This nearly year-long process resulted in the Settlement, which Class Plaintiffs and Interim Co-Lead Class Counsel believe to be fair, reasonable, and adequate.

The Settlement is separate from, and in addition to, JPMorgan’s settlements with the U.S. Department of Justice (DOJ), the United States Attorneys’ Office for the District of Connecticut (USAOC), and the Commodity Futures Trading Commission (CFTC). Accordingly, the Settlement significantly augments any recoveries that Class Members may be eligible for from the DOJ and USAOC’s victim compensation payment amount (VCPA) and ensures that eligible Settlement Class Members will be compensated for damages caused by JPMorgan’s spoofing in the U.S. Treasury Futures and Options on U.S. Treasury Futures market.