A district court judge in the US has thrown out investor lawsuits against Barclays and a host of exchanges, dismissing claims that the bank rigged its “dark pool” trading venue in favour of high-frequency traders.
The multi-district litigation was part of a litany of claims set off by Flash Boys: A Wall Street Revolt, Michael Lewis’s best-selling book published last year. In it, Mr Lewis argued that high-frequency traders were able to gain an unfair advantage because stock exchanges and “dark pools” — broker-run trading venues that allow buyers and sellers to swap shares with greater anonymity — had enabled those traders to obtain and trade on market data faster than other investors.
But judge Jesse Furman of the Southern District of New York said on Wednesday that the plaintiffs did not allege any actions that met the definition of “manipulative acts”, or how those actions could have affected the price at which securities traded in the dark pool.