$60M JPMorgan Investor Class Action Settlement Over Precious Metals Futures Put On Hold

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JPMorgan Chase Metal Futures Artificial Demand Class Action Overview: 

  • Who: A judge declined to greenlight a $60 million settlement agreement between JPMorgan Chase and a Class of investors. 
  • Why: Investors claimed JPMorgan and three of its former traders engaged in a yearslong scheme to give the artificial appearance of high demand for metal futures.
  • Where: The class action is pending in New York federal court.

A federal judge in Manhattan declined to sign off on a $60 million class action settlement deal between JPMorgan Chase and investors who claim the company engaged in a yearslong scheme to create the false appearance of high demand for precious metals futures. 

The settlement agreement would resolve claims made in six consolidated lawsuits against JPMorgan and three former traders who allegedly placed and canceled trades to create the illusion of high demand between 2008 and 2016. 

John Edmonds, a former JPMorgan trader, pled guilty in 2018 to “spoofing” metal futures in the market over a six-year period, reports Law360. 

JP Morgan Class Action Settlement Raised Too Many Questions, Says Judge 

The judge had a number of questions, including why the $60 million was planned to be divided up depending on when investors traded gold or silver futures. 

“There’s no way for me to get behind those numbers, and more importantly there’s no way for potential class members to get behind those numbers,” the judge said, according to Law360. 

The judge was also concerned with if the settlement created roadblocks for investors who were unsatisfied with the agreement, a requirement that investors produce evidence of their own trades to opt out, and for the overall advertising strategy related to the settlement notice. 

“I came away with the impression that this plan was not thinking conscientiously about the rest of the world,” the judge said, reports Law360. “The fact that you can’t tell me why it is that you prioritized Quebec over China or Europe just heightens that concern.” 

JPMorgan reached an $8.3 million settlement agreement in 2018 with a Class of assistant bank managers who claimed the investment banking company improperly treated them as non-exempt workers

Do you agree with the judge’s decision to stay the settlement agreement between JPMorgan Chase and its investors? Let us know in the comments! 

The plaintiffs are represented by Vincent Briganti, Raymond P. Girnys, Christian Levis, and Sitso W. Bediako of Lowey Dannenberg PC.

The JPMorgan Chase Metal Futures Artificial Demand Case is In re: JPMorgan Precious Metals Spoofing Litigation, Case No. 1:18-cv-10356, in the U.S. District Court for the Southern District of New York.


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