The small investors suing Citadel Securities LLC are fighting back against its motion to dismiss their case:
Plaintiffs suing Citadel Securities and others over trading restrictions on “meme stocks” have filed a motion to strike the market maker’s recent court filing that leaned on the SEC’s report to dismiss the conspiracy charges.
Describing the notice as “incomplete and misleading,” they challenged Citadel Securities about its efforts to call the court attention to conclusions set out in the SEC’s report on the retail trading mania earlier this year.
Citadel’s reliance on the SEC report to defend itself is problematic. As I wrote here last week, the report barely even covered allegations of collusion between Citadel and Robinhood Markets, Inc. in limiting trading.
The lengthy report devotes just a single paragraph to the allegations. It also takes Citadel LLC CEO Ken Griffin and Robinhood CEO Vlad Tenev at their word.
What’s more, the report has no force of law:
The legal notice further explains that while the 45-page report was simply meant to describe events, the market maker had misinterpreted the regulatory body’s bulletins which, like all staff statements, have no legal force or effect.
Despite the serious allegations against his firm, Griffin still characterizes them as “a bad comedy joke.”
But Citadel could face billions in damages if it loses. Even for someone with Griffin’s wealth, that’s no laughing matter.
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