Commodity Exchange – Gold Futures and Options Trading Litigation

Frequently Asked Questions

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Questions

Answers

1. What is this lawsuit about?

Plaintiffs allege that, from January 1, 2004 through June 30, 2013 inclusive (the “Settlement Class Period”), Defendants (Deutsche Bank AG, HSBC Bank plc, Barclays Bank plc, Société Générale SA, The Bank of Nova Scotia, and The London Gold Market Fixing Limited) conspired to drive down the price of gold around the time of a daily, secret, and unregulated afternoon meeting (the “PM Gold Fix”).  The PM Gold Fix was intended to determine the global benchmark price per ounce of gold (the “Fix price”) based on supply and demand fundamentals stemming from a competitive gold auction among the Fixing members.  However, Defendants allegedly capitalized on the lack of regulatory oversight and the private nature of the PM Gold Fix to facilitate Defendants’ agreement to manipulate and fix gold prices and the prices of Gold Investments during the Settlement Class Period.  Defendants’ conduct harmed other market participants like Plaintiffs and the Settlement Class.  “Gold Investments” means (i) gold bullion, gold bullion coins, gold ingots, gold bars, or any other form of physical gold, (ii) gold futures contracts in transactions conducted in whole or in part on COMEX or any other exchange operated in the United States (iii) shares in gold ETFs, (iv) gold call options in transactions conducted over-the-counter or in whole or in part on COMEX or any other exchange operated in the United States (v) gold put options in transactions conducted over-the-counter or in whole or in part on COMEX or any other exchange operated in the United States, and (vi) gold spot, gold forwards, or gold swaps traded over-the-counter.

The Defendants, by virtue of their overt but non-public interactions in connection with the daily Gold Fixing, were uniquely positioned to effectively “name their own” Fix price and thereby to gain an unfair advantage with respect to the contracts, derivatives, and physical positions that they held in the market, all of which were correlated to the Fix price in one way or another.  In particular, Plaintiffs allege that Defendants were motivated to profit, and did in fact profit, from their intentional and coordinated suppression of gold prices around the PM Fixing, which had the effect of depressing prices for Gold Investments.  Plaintiffs allege that Defendants effectuated their conspiracy in several ways.  For example, leading up to the PM Fixing, Defendants allegedly collected confidential client order information and then improperly shared that information amongst themselves in order to compare and coordinate the execution of particularly large sell trades, thereby driving down the gold spot price immediately before and during the Fixing call.  During the Fixing window itself, Plaintiffs allege that Defendants offered “rigged” auction rates that were either fabricated or artificially depressed by Defendants’ prior coordination of large sell orders, which had the effect of magnifying a downward effect in the resulting Fix price.  Defendants also allegedly communicated with each other throughout the day through phone calls, chat rooms, and other forms of electronic communication to coordinate trading (including to “net off” large buy orders) in order to ensure that their efforts to drive down the gold price were not undone by counteracting trading activity.  Plaintiffs further allege that Defendants used manipulative trading tactics such as “spoofing” (sending false signals to the market by placing large orders that were never executed), “wash sales” (placing large orders that are executed and then quickly reversed), and “front running” of customer orders in order artificially to suppress the price of gold.

Plaintiffs have asserted legal claims under federal antitrust law for price fixing and unlawful restraint of trade; under the Commodity Exchange Act for price manipulation, manipulation by false reporting and fraud and deceit, aiding and abetting and principal-agent liability, and under the common law.

Plaintiffs and Plaintiffs’ Co-Lead Counsel believe that Settlement Class Members have been damaged by Defendants’ conduct.  Defendants do not agree with the allegations made by Plaintiffs, believe that they have meritorious defenses to Plaintiffs’ allegations, and believe that certain of Plaintiffs’ claims would have been rejected prior to trial, at trial (had Plaintiffs successfully certified a class and survived summary judgment motions), or on appeal.  As a result, the Defendants believe Settlement Class Members would have received nothing if the litigation had continued to trial.

The Court has not decided for or against Plaintiffs or the Defendants.  Instead, Plaintiffs’ Co-Lead Counsel engaged in negotiations with the Defendants to reach a negotiated resolution of the claims against them.  The Settlements allow Plaintiffs and the Settling Defendants to avoid the risks and costs of lengthy litigation and the uncertainty of pre-trial proceedings, a trial, and appeals.  The Settlements permit eligible Settlement Class Members, who file timely and valid Proof of Claim and Release Forms, to receive compensation, rather than risk ultimately receiving nothing. 

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2. What do the Settlements provide?

The agreement with Deutsche Bank and the agreement with HSBC are referred to as the “Original Settlements,” and those banks are referred to as the “Original Settling Defendants.”  The Original Settling Defendants will collectively pay the Settlement Class $102 million.

The agreement with the remaining Defendants (Barclays Bank PLC, The Bank of Nova Scotia, Société Générale, and The London Gold Market Fixing Limited) is referred to as the “Third Settlement Agreement", and those Defendants are referred to as the “Newly Settling Defendants.”  The Newly Settling Defendants will collectively pay the Settlement Class $50 million.

The amount of payments to Settlement Class Members will be determined by the Plans of Allocation that the Court approved for each Settlement.  The Plans of Allocation will allocate the Net Settlement Fund equitably among Authorized Claimants on a pro rata basis based on the total qualifying claim amounts, adjusted for certain factors, such as the time period and type of the Authorized Claimants’ transactions.  If, as an Authorized Claimant, your total distribution is below a minimum threshold, you may instead receive an Alternative Minimum Payment.  The Alternative Minimum Payment will be a set amount for all such Authorized Claimants.  

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3. Who is included in the settlements?

The Settlement Classes for both the Original Settlements and the Third Settlement Agreement are defined the same way:  All persons or entities who during the period from January 1, 2004 through June 30, 2013, either (A) sold any physical gold or financial or derivative instrument in which gold is the underlying reference asset, including, but not limited to, those who sold (i) gold bullion, gold bullion coins, gold bars, gold ingots or any form of physical gold, (ii) gold futures contracts in transactions conducted in whole or in part on COMEX or any other exchange operated in the United States, (iii) shares in gold exchange-traded funds (“ETFs”), (iv) gold call options in transactions conducted over-the-counter or in whole or in part on COMEX or any other exchange operated in the United States; (v) gold spot, gold forwards or gold swaps over-the-counter; or (B) bought gold put options in transactions conducted over-the-counter or in whole or in part on COMEX or on any other exchange operated in the United States.

Excluded from the Settlement Classes are Defendants, their officers, directors, management, employees, affiliates, parents, subsidiaries, and co-conspirators, whether or not named in the Action, and the United States Government, and other governments.  Also excluded is the Judge presiding over this action, her law clerks, spouse, and any person within the third degree of relationship living in the Judge’s household and the spouse of such a person.

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4. When and Where is the Fairness Hearing?

The Fairness Hearing for the Original Settlements took place on January 4, 2022.  The Original Settlements were approved.  Another Fairness Hearing took place on August 5, 2022.  The Third Settlement and revised Plans of Allocations were approved.  The Final Judgment and other related documents may be found under the “Documents” tab on this website.

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5. How do I get Additional Information?

The Settlement Agreements and other important documents related to these Actions are available in the documents section of this website and   also available for review during normal business hours at the office of the Clerk of Court, United States District Court for the Southern District of New York, 500 Pearl Street, New York, New York 10007-1312.  If you have questions about the Notice, the procedure for registering, or the Settlement Agreements, you may contact Plaintiffs’ Interim Co-Lead Counsel at the address listed in the Notice.

DO NOT CONTACT THE DISTRICT COURT OR THE CLERK'S OFFICE REGARDING THIS WEBSITE.

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6. How do I know if I have a claim on file?

To verify a previous claim submission or for any questions regarding claim status please email [email protected]

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7. I filed a claim.  How much will I receive?

Your claim will be calculated in accordance with the court-approved Plans of Allocation, which you may view here (original Settlements) and here (third Settlement). At this time, claims are still being processed and the pro rata amount that eligible claimants may receive is not available. Please check the website periodically for further updates.

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8. When will the distribution to eligible claimants take place?    

We are currently working towards distribution; however no firm date is yet available.  Please check the website periodically for updates.

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This website is authorized by the Court, supervised by counsel and controlled by the Settlement Administrator approved by the Court. This is the only authorized website for this case. Please note, however, that documentation on this site does not include all materials filed in the litigation; a complete set of filed materials are publicly accessible via PACER, the federal court system’s electronic public access portal.

For more information please call 844-271-4787

Documents

Documents

Contact

Contact us with any inquiries, comments, and/or requests.

Important Dates

  • Claim Form Deadline

    Tuesday, April 19, 2022 The claim filing deadline has now passed. You must have submitted your new or revised Claim Form no later than Tuesday, April 19, 2022.
  • Exclusion Deadline

    Tuesday, April 19, 2022

    The exclusion deadline has now passed.  You must have completed and mailed your request for exclusion so that it was received no later than Tuesday, April 19, 2022.

  • Objection Deadline

    Friday, June 24, 2022 The objection deadline has now passed. You must have mailed your objection(s) and/or notice of intent to appear at the Final Approval Hearing so that it/they were received no later than Friday, June 24, 2022.
  • Fairness Hearing

    Friday, August 5, 2022 The Fairness Hearing for the Third Settlement Agreement and for the Plans of Allocation took place on Friday, August 5, 2022 at 10:00 AM. All Settlements and Plans of Allocation have now been approved.

Documents Regarding Final Approval of the Third Settlement Agreement

Documents Regarding Motion for Attorneys’ Fees, Litigation Expenses, and Incentive Awards

Documents Regarding Preliminary Approval of Notice and Plan of Allocation for the Third Settlement Agreement

Documents Regarding the Claim Process

Documents Regarding Preliminary Approval of the Third Settlement Agreement

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