London Metal Exchange Sued For $456 Million Over Nickel Chaos

Elliott Investment Management is suing the London Metal Exchange (LME) for $456 million over its March decision to cancel nickel trades following a massive short squeeze.

The claim was filed by two Elliott vehicles against LME and its clearing house in the English High Court on June 1. The LME management has since said that the claim against it is without merit and that it will be “vigorously” contested. 

Elliott’s claim against LME exacerbates pre-existing pressure on the financial institution, which has been heavily criticised for its decision to stop trading and cancel bets. The LME is facing a review by regulators in the UK after it reversed billions of dollars of transactions and ended trading for more than a week. Since, the nickel market has been left in an ongoing limbo of volatility and low liquidity.

Elliott’s claim against LME will challenge the decision to cancel trades, arguing it was “unlawful on public law grounds and/or constituted a violation of their human rights.”