MOSCOW, October 2 (RAPSI) – The Moscow Commercial Court has dismissed a claim initiated by investors affected by an unprecedented drop in WTI oil prices collectively against the Moscow Exchange, according to court records.
In early June, the lawsuit was filed by 23 plaintiffs with the Presnensky District Court in Moscow, according to MILTON LEGAL partner Sergey Shakirov. Other plaintiffs, he said earlier, would join the move later. At that time the claim sought recovery of about 40 million rubles ($580,000 at the current exchange rate) as alleged damages. Later, the lawsuit was transferred to the Moscow Commercial Court.
The plaintiffs alleged an early close of trade at negative oil prices was unlawful.
Negative prices of WTI oil futures were registered on April 20 catching the exchange and brokers by surprise; the operations were stopped at $8.84 per barrel.
Traders had absolutely no opportunity to influence the deal, so the positions of investors were undermined as they could not dispose of their securities, the initiators of the lawsuit allege.
According to the lawyer, the Moscow Exchange software was not suited to trade at negative prices, whereas the Exchange management refused to nullify the results of the operations and compensate damages to its clients. The investors also insist that the defendant made certain mistakes as concerned to risk management, failed to change the parameters of the amounts of the initial margin, and refused to permit trade to be continued in spite of the fact that they had the respective technical means at their disposal.