Susquehanna and Citadel Securities have told a Manhattan judge they will settle with a number of the traders they sued over a May options book and will drop the case against those who pay.
The firms wrote to Judge Arun Subramanian on the night of September 28. They will not file an amended complaint. As each settlement is signed, they will file dismissals with prejudice. They kept the right to come back against anyone who does not settle. They asked for until October 12 to finish the paperwork. Bloomberg reported the letter the next day. The docket is 1:26-cv-05474, Southern District of New York.
Why did Susquehanna sue over Futu and Tiger puts?
The complaint, filed on June 29, said unknown accounts bought more than 200,000 short-dated puts on Futu Holdings and UP Fintech (Tiger Brokers) in the two weeks before Beijing announced a crackdown on cross-border trading platforms on May 22. The puts cost about $12 million and made more than $100 million, the filing said. Susquehanna said it was the seller on trades that accounted for about $71 million of that. Citadel Securities later joined as an intervenor.
On September 14 the judge refused a preliminary injunction. He said Susquehanna had not shown that the trading was tied to inside knowledge of the Chinese announcement. The settlements follow that order.
No dollar figure for the settlements is available. The original request was “no less than $71.4 million.” A market maker can sue as the other side of an alleged insider trade. Winning the freeze is a different test. Here the freeze failed and the cheque is being negotiated.
The civil file does not say whether the Justice Department or the SEC has a case of its own.
