Advertisement

High court rejects suit against NYSE

Share via
From Times Wire Services

The U.S. Supreme Court on Monday refused to open the New York Stock Exchange to private lawsuits accusing it of failing to enforce its own rules.

The justices rejected an appeal by the California Public Employees’ Retirement System, which sought to revive accusations that the NYSE let its “specialist” firms trade for their own accounts ahead of clients.

CalPERS’ suit stemmed from a 2003 scandal in which regulators accused seven specialist firms -- companies that execute trades for investors on the NYSE floor -- of fraud.

Advertisement

The firms settled with the Securities and Exchange Commission in 2005 and paid more than $240 million in fines without admitting or denying guilt.

A federal appeals court had ruled against CalPERS, saying the NYSE was immune from private suits focused on regulation. CalPERS, the biggest U.S. pension fund, argued in its appeal that the lower court ruling would shield the NYSE from suits even when it abandoned its regulatory duties.

Advertisement