Court denies summary judgment motion by Global Brokerage, Drew Niv
There has been some development in the lawsuit brought by investors against FXCM Inc, now known as Global Brokerage Inc, Drew Niv and William Ahdout.
On August 17, 2022, Judge Ronnie Abrams of the New York Southern District Court signed an order denying the defendants’ motion for summary judgment.
This case stems from the events from February 2017, when FXCM reached settlements with the CFTC and NFA, in a move that led to its exit from the US retail FX market. The price of FXCM’s securities plummeted after the regulatory settlements were announced, thereby damaging investors in FXCM Inc.
The plaintiffs brought this class action suit against FXCM, Dror Niv and William Ahdout, alleging that, from March 15, 2012 until February 6, 2017, Defendants committed securities fraud in violation of Sections IO(b) and 20(a) of the Securities Exchange Act of 1934 and Rule l0(b)-5. Specifically, the plaintiffs allege that the defendants were responsible for false or misleading statements with respect to FXCM’s purported agency-trading model and FXCM’s relationship with another company, Effex Capital.
The plaintiffs, suing on behalf of themselves and all others similarly situated, allege that defendants violated the federal securities laws by knowingly misleading investors as to the nature of FXCM’s No Dealing Desk (NDD) platform and FXCM’s relationship with the largest market maker for its NDD platform.
In September 2021, the defendants said they intended to move for summary judgment against both the certified class as well as the individual convertible notes plaintiff, 683 Capital Partners, LP.
The defendants moved for summary judgment on Plaintiffs’ and the Class’s Section 10(b) claims with respect to the elements of falsity, scienter, loss causation, and economic loss, and with respect to the element of reliance only as to 683 Capital’s individual claim.
The plaintiffs have opposed the motion. Apparently, the Court sided with the plaintiffs regarding the summary judgment.
At this point, the Court did not provide any details on the ruling. The Judge said, however, that the reasons for the decision will be articulated at the conference scheduled on August 19, 2022 at 1:00 p.m.