naz could ultimately press for jurisdiction over all ecn's. is that progress or regression? Naz waited til EMLX dropped 70ish points before they halted it -- that was a disaster. Seems like this time ARCA did what Naz couldn't... Why should trades be broken? Weren't they entered into by willing parties? Please, if I am missing something here, clue me in.
once again, the average voter doesn't understand the diff between free and open markets and corporate welfare. they are not the same!
(REUTERS) UPDATE 1-Nasdaq sued for canceling Corinthian trades UPDATE 1-Nasdaq sued for canceling Corinthian trades (Adds byline, updates with Schumer statement, details) By Nicole Maestri NEW YORK, Dec 9 (Reuters) - Traders sued the Nasdaq Stock Market Inc. <NDAQ.OB> Tuesday claiming they lost money when the stock market canceled trades of Corinthian Colleges Inc. <COCO.O> after its shares plunged 32 percent in only 12 minutes on Friday. DL Capital Group LLC is seeking to collect for damages it said it sustained when Nasdaq halted Corinthian shares for trading after the plunge, but then lifted the halt before telling investors it would cancel trades that took place in the 12 minute time frame. The lawsuit comes as calls widened on Tuesday for federal regulators to conduct a review of the mishap. New York Sen. Charles Schumer asked the U.S. Securities and Exchange Commission to investigate trading of Corinthian shares, saying the SEC "needs to open a probe to figure out what went wrong in this case and how to prevent these issues in the future." Meanwhile, a source told Reuters that a regulatory investigation of the entire affair is likely. LAWSUIT FOLLOWS CANCELATION On Friday, shares of Corinthian Colleges, a for-profit college operator, sank from $57.45 at 10:46 a.m. EST to $38.97 in 12 minutes. Nasdaq halted trading in the stock for roughly one hour, saying an "erroneous trade," in which multiple orders were routed to several trading venues by a single customer, prompted "extraordinary market activity." DL Capital said in its suit that it purchased Corinthian shares during the 12 minute period, and then sold its shares for a profit shortly after trading resumed. But Nasdaq's decision to cancel the earlier trades, which it announced after shares were released for trading, left DL Capital facing a loss, the suit alleges. "Nasdaq did not disclose a critical fact, which was that they were going to cancel all the trades," said Sherrie Savett, a lawyer with Berger & Montague, representing DL Capital. Nasdaq said it had no comment on the lawsuit. "If DL Capital had known that its purchase of COCO shares would be canceled, it would not have sold those same shares after trading resumed -- i.e. it would not have sold shares which it did not own," stated the suit, filed Dec. 8 in the U.S. District Court of the Southern District of New York. Meanwhile, the trading mishap has touched off a regulatory tug-of-war between Nasdaq, the No. 2 stock market, and its competitors. On Monday, Nasdaq filed a request with the SEC seeking broader authority to suspend trading across all trading platforms of Nasdaq-listed stocks. The proposal followed a complaint by the Pacific Exchange that Nasdaq had no right to halt trading in Corinthian shares for what it called a "systems" problem and not a regulatory issue. The Pacific Exchange, which acts as the regulator for the Archipelago Exchange, has asked the SEC to probe last week's stoppage. The lawsuit filed against Nasdaq said it was bringing the action on behalf of DL Capital as well as a class, consisting of those who traded the common stock between 10:46 a.m. and the time Nasdaq announced the cancellation of all trades. (Additional reporting by Javier David in New York and Kevin Drawbaugh in Washington) ((Reporting by Nicole Maestri; editing by Phil Berlowitz; Reuters Messaging: nicole.maestri.reuters.com@reuters.net; (646) 223-6173)) REUTERS *** end of story ***
The last thing Nasdaq should get is jurisdiction over all trading venues for nasdaq stock. Nasdaq is not a real stock exchange like the NYSE but a group of marketmakers who set up systems and rules for trading among themselves. Why the f*ck should they have jurisdiction over ECN's? Talk about rewarding someone for their own incompetence.
How is this any different than the CME or CBOT busting trades on a spike in the emini or dow mini contracts? I wonder why no one sues them?
i dont think its the busting of trades that is the problem that is done all the time. its reopening and then deciding to bust the trades that hurt people and opens them up to being liable for losses.
So if I understand this correctly: 1.) Busting trades - o.k. (CME & CBOT specialty) 2.) Halting a stock - o.k. (a NYSE specialty) 3.) Halting a stock and busting trades - lawsuit, not o.k.