LONDON (BLOOMBERG) - The London Metal Exchange (LME) is being sued for US$456 million ($627 million) over its decision to halt and undo trading in nickel after a short squeeze in March caused prices to skyrocket.
The exchange is being sued by Elliott Associates and Elliott International in a case filed in the English High Court on June 1, according to a statement issued by Hong Kong Exchanges and Clearing, its parent company.
"The LME management is of the view that the claim is without merit and the LME will contest it vigorously," it said in the statement. The exchange issued more than US$7 billion of margin calls as nickel prices spiked in March - nearly four times the previous daily record.
The group cancelled billions of dollars of transactions at the highest prices. The LME has been widely criticised for its handling of the crisis and British regulators have announced reviews of its actions.