BDbuzz:Archipelago, Other ECNs in Legal Brouhaha
Posted: Fri Mar 21, 2003 2:00 am Post subject: Instinet,
Leading agency broker Instinet, which is 63-percent owned by information giant Reuters Group Plc, is being sued for about $306 million in damages by Archipelago and other ECNs for allegedly unfair business practices, according to legal documents. The Island ECN, which Instinet acquired last September, took several competitors for arbitration before the NASD for alleged failure to pay some fees. The case was filed against Archipelago, which is completing its transformation into the ArcaEx exchange; RediBook, which merged with Archipelago last year; and Bloomberg’s B-Trade Services. Island is seeking $9.1 million from Arca-Redi and $1.9 million from B-Trade, according to Reuters’ Form 20-F filing and 2002 annual report. But Archipelago has filed a counterclaim alleging that Island engaged in “unfair, discriminatory pricing practices,” breach of contract, attempted monopoly and “conspiracy to restrain trade under the U.S. Sherman [anti-trust] Act.” Archipelago is seeking at least $90 million for damages under federal anti-trust laws, while B-Trade asked for $2.7 million. Archipelago launched a separate action against Instinet before the NASD on similar allegations and is seeking at least $123 million in damages. Separately, NexTrade Holdings has commenced an action against another Instinet unit, direct-access broker ProTrader, for infringement of NexTrade’s trademark rights. NexTrade is seeking up to $90 million in damages. |
