“Mega lawsuit” targeting FXCM gets referred to Magistrate Judge
The case has been referred to Magistrate Judge Barbara Moses for general pretrial, such as scheduling and discovery.
The so-called “mega lawsuit” targeting Global Brokerage, Inc. formerly known as FXCM Inc., Dror Niv, and William Ahdout, continues at the New York Southern District Court, with the case having been referred to Magistrate Judge.
On November 5, 2019, Judge Ronnie Abrams signed an Order stating that the case, brought by FXCM Inc stockholders, is referred to Magistrate Judge Moses for general pretrial (scheduling, discovery, non-dispositive pretrial motions, and settlement).
The case relates to the events from February 2017 which saw the brokerage leave the US retail FX market. The lead plaintiffs in this case – 683 Capital Partners, LP and Shipco Transport Inc., and named plaintiffs Sergey Regukh and Brian Armstrong, allege that from March 15, 2012 until February 6, 2017, the 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 the company’s purported agency-trading model and FXCM’s relationship with another company, Effex.
In June this year, the Court approved the case management plan in this lawsuit.
This case is to be tried to a jury. The parties have conferred and their present best estimate of the length of trial is 5-10 days. Amended Pleadings are due by April 3, 2020. Discovery is due by November 4, 2020.
On March 28, 2019, the Court concluded that the second amended complaint adequately alleges that FXCM, Niv and Ahdout have committed securities fraud with respect to statements or omissions concerning FXCM’s supposed agency-trading model, the Company’s purported “order flow” payments with Effex, and Generally Accepted Accounting Principles (GAAP).