Guest Post: Summary of Silver Civil Suit Dismissal by CALawyer

As you may have heard by now, the latest civil suit against JPM for silver manipulation was dismissed late last week. Though this is disappointing, in hindsight it is hardly surprising, given the continued and deliberate malfeasance of the CFTC.

LEGAL SUMMARY by CALawyer, Esq.

Resident Legal Expert and Attorney General of Royal Turdistan

I have carefully read the Court’s Opinion which granted JPM’s Motion to Dismiss the silver manipulation case, which case had been pending in the United States District Court, Southern District of New York.  

The caption information is here:

Case 1:11-md-02213-RPP   Document 127    Filed 12/21/12   Page 1 of 41

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

IN RE COMMODITY EXCHANGE, INC., SILVER FUTURES AND OPTIONS TRADING LITIGATION

ROBERT P. PATTERSON, JR., U.S.D.J.

Summary of My Analysis:

Re Court’s Ruling on JPMorgan’s FRCP Rule 12(b)(6) Motion to Dismiss for Failure to State a Claim

I am setting forth my take on the Court’s ruling.  I am not surprised by the ruling, because in hindsight, I can see fairly clearly that JPM had the winning hand from the get go.  I feel rather inept for not figuring this out earlier, but, the argument is rather simple:

(1) Congress is tasked with regulating commerce, and created the CFTC to regulate commodities futures and options, including silver [  http://www.cftc.gov/About/MissionResponsibilities/index.htm ];

(2) The CFTC is not part of Congress, nor part of the Executive branch, but is an independent agency; however, it is still part of the Executive Branch, tasked with regulating futures and options [ http://wiki.answers.com/Q/Whats_the_difference_between_an_executive_agency_and_an_independent_regulatory_agency  ].

Other independent agencies are the CIA, SEC, FCC, FTC, NASA, and on and on.  Some call this the fourth branch of government, but in reality, all federal “agencies” are just tentacles of the same federal government octopus exerting control over all of us all the time.

(3) The federal government, in general, through its proxies and institutions like the Federal District Courts, ALWAYS acts to protect itself, to include never acting to shrink itself, to disgorge power, to decentralize, to neuter its capabilities or scope of influence, etc.;

(4) In the balance of power arrangement with the three co-equal branches of government, Executive, Legislative, and Judicial, the Judicial branch typically defers making a Constitutional decision when there are other options to dispose of a case;

(5) Here, there is a govt agency DIRECTLY charged with dealing with the exact issue before the court, and is ACTIVELY doing so, namely, whether JPM engaged in fraud and manipulation with respect to silver futures and options.  Look at the CFTC mission statement [ http://www.cftc.gov/About/MissionResponsibilities/index.htm ]:

“Congress created the Commodity Futures Trading Commission (CFTC) in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States. The agency's mandate has been renewed and expanded several times since then, most recently by the Dodd-Frank Wall Street Reform and Consumer Protection Act.

In 1974 the majority of futures trading took place in the agricultural sector. The CFTC's history demonstrates, among other things, how the futures industry has become increasingly varied over time and today encompasses a vast array of highly complex financial futures contracts.

Today, the CFTC assures the economic utility of the futures markets by encouraging their competitiveness and efficiency, protecting market participants against fraud, manipulation, and abusive trading practices, and by ensuring the financial integrity of the clearing process. Through effective oversight, the CFTC enables the futures markets to serve the important function of providing a means for price discovery and offsetting price risk.

The CFTC's mission is to protect market users and the public from fraud, manipulation, abusive practices and systemic risk related to derivatives that are subject to the Commodity Exchange Act, and to foster open, competitive, and financially sound markets.”

(6) The “expert” govt agency, the CFTC, found no manipulation in either of the two prior manipulation investigations, nor was any found in the ongoing investigation;

(7) Since the govt agency best charged with investigation is doing it, and found nothing then nor now, then why should the Court involve itself in another agency’s business? [Remember, the Court does not view the CFTC as a corrupt, captured shill agency like we all view it.]

(8) In short, because the Complaint essentially argues that something is amiss that the “expert” govt agency has not found, then the Court is not likely to step in and muddle around;

(9) The situation would be different if the Complaint alleged that the CFTC commissioners were corrupt, that is, were allowing fraud and manipulation despite proof of it occurring, in which the Court may very well step in and allow the case to proceed.  Remember, this is not the stage of the lawsuit where a judgment is made; rather, the Court is only asked to decide whether the Plaintiffs have alleged facts sufficient to make out a plausible rather than just possible case.  If the Court agreed with the Plaintiffs, then discovery would commence, and then the massive lawyering with depositions, document productions, etc., would begin.  

The argument would be that the CFTC is corrupt, and that the Court needs to protect the market because the CFTC will not.

[This is NOT a compelling argument, because it is asking the Govt to fix itself, which it will never do, ever.  It does not exist to shrink, or to devolve power, or to decentralize power.  It will never act to harm itself, ever.  Only a collapse/revolution will fix the system, and history has shown this solution over and over again.  So, the Plaintiff’s, embarking on a noble effort for sure, have run up against an impossible task.  The only other way I see to fix the mess is for a market solution by another sovereign.  If market participants do not believe the system is fair, then another system will emerge for sure, eventually.]

 Anyhow . . .

(10) But, the Complaint made no such allegations of corruption of the CFTC, and the whole case is basically asking the Court to do what the CFTC has done and found nothing, as well as what the CFTC is currently doing;

(11) The Court is not apt to nor will it do the CFTC’s job;

(12) So, to summarize, the Complaint asks the Court to do the CFTC’s job, the Court says no thanks, and that is that.

(13) From a more conspiratorial bent, to me anyway, that explains why the CFTC has not issued a ruling yet on their ongoing investigation of alleged silver manipulation.  If the CFTC delays a ruling, then, like here, the Court is going to defer to the CFTC, because the CFTC is the “expert” govt agency directly charged with this task, not the Courts.

(14) Procedurally, the next step is that the Plaintiffs can ask the Court for another chance to allege some facts, but the Court’s denial of the Motion to Compel discovery sheds some light on the potential outcome of that effort.

(15) If the Court is denying discovery, then what additional facts can the Plaintiffs allege?  

(16) Will the Plaintiff’s appeal the ruling to dismiss the case?  Why would they not? They have invested so much time and effort to date, why would then not take the case up to the Court of Appeal?  This is high stakes, so the Plaintiffs’ attorneys will almost certainly appeal, so this case is not over, but the discovery effort is certainly dead for now.

(17) Absent discovery, this case becomes a legal, procedural question, BORING!

(18) Look for the CFTC to either end the manipulation inquiry with no finding [likely], or to continue the delay pending the final ruling on this case [unlikely].

The analysis of the Court’s Order is below.

Summary of Arguments and Order:

On September 12, 2011, Plaintiffs filed a consolidated class action complaint (“the
Complaint”) claiming that Defendants J.P. Morgan Chase & Co., J.P. Morgan Clearing Corp., J.P. Morgan Securities Inc., and J.P. Morgan Futures Inc. (together, “JPMorgan” or the “JPMorgan Group Defendants”), as well as twenty unnamed “John Doe” Defendants (collectively, “Defendants”), violated Sections 9(a) and 22(a) of the Commodity Exchange Act, 7 U.S.C. §§ 13(a), 25(a), and Section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1.  (Compl. ¶¶ 1-2, 22-29, 199-210, ECF No. 85.)  The Complaint alleges that Defendants violated these acts by combining, conspiring, and agreeing to manipulate the prices of silver futures and silver options contracts traded on the Commodity Exchange Inc. (“COMEX”) on June 26, 2007 and also between March 17, 2008 and October 27, 2010 (together, the “Class Period”).  (Id. ¶ 1.)  The
Complaint further alleges that, as a result of Defendants’ unlawful conduct, Plaintiffs, a
proposed class of individuals who transacted in COMEX silver futures and options contracts during the Class Period, “lost money and were injured in their property.”  (Id. ¶ 21.)  

On December 12, 2011, the JPMorgan Group Defendants filed a motion to dismiss the
Complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.  (Defs. Mot. to Dismiss, ECF No. 91.)  While argument was pending on the motion to dismiss, Plaintiffs filed a motion to compel limited discovery on April 17, 2012.  (Pls. Mot. to Compel Ltd. Disc. (“Mot. 1 Case 1:11-md-02213-RPP   Document 127    Filed 12/21/12   Page 1 of 41to Compel”), ECF No. 104.)  For the reasons stated below, the motion to dismiss is GRANTED and the motion to compel is DENIED.

Facts:

    Discussed at pages 2-15 of the Order.  I am not going to recite them again.  Anyone who wants to look, go to Pacer, look up the case number, and go to the end of the docket.  The Order is document 127.  The Order is probably posted somewhere online by now as well, but I did not go try to find it.  

    What I will set out here are the basics.  The Court outlined the concept of Comex silver futures and options contracts, calling this subject matter “esoteric,” and used an example.  Notably, there was no discussion of the concept of “naked” shorting, though.  

    The Court mentioned that the CFTC was created in 1974 to regulate the futures and options markets in the USA:

“In 1974, Congress established the Commodity Futures Trading Commission (the
“CFTC”) as an independent government agency to regulate commodity futures and option markets in the United States.  See 7 U.S.C. § 1 et seq.  The CFTC is charged with protecting market users and the public from fraud, manipulation, and abusive practices in the commodity futures marketplace.  Id.  Should the CFTC suspect an attempted or perfected manipulation of the silver futures market, the CFTC has broad authority to investigate and, if appropriate, to pursue enforcement actions.  Id. §§ 7, 13(a)(2).”

    Starting in 2004, there were complaints to the CFTC about silver manipulation.  There was no mention of the Hunt Brothers and that mess, though.  
    
    The Opinion discussed how the CFTC formally launched silver price manipulation investigations three times, that the first two resulted in a finding of no manipulation, and that the third investigation, started in 2008, is ongoing and has not resulted in a finding of manipulation.

    [At this point of my reading of the Court’s Opinion, it was CRYSTAL CLEAR to me that the Judicial Branch, here, United States District Court for the Southern District of New York, is DEFERRING to Congress through its creature the CFTC, and is basically setting the stage upon which the Court tells everyone: “If there is a problem here, it is the CFTC’s, not ours; go tell it to the CFTC.
      
For the non-lawyers in the crowd, here is the law so one can understand the parameters guiding the Court’s ruling.

“LEGAL STANDARD

To survive a motion to dismiss, a complaint must plead “enough facts to state a claim to
relief that is plausible on its face.”  Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007).  In considering whether a plaintiff has “nudged [his] claim across the line from conceivable to plausible,” id., a court must accept all factual allegations in the complaint as true and must draw all reasonable inferences in favor of the complainant, Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir. 2008); see also supra n.1.  “Nevertheless, the court need not accord legal conclusions, deductions or opinions couched as factual allegations a presumption of truthfulness.”   In re Amaranth Natural Gas Commodities Litig. (“Amaranth I”), 587 F. Supp. 2d 513, 528 (S.D.N.Y. 2008) (internal quotation marks and alterations omitted); see also Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009) (“[A]lthough a court must accept as true all of the allegations contained in a complaint, that ‘tenet’ is inapplicable to legal conclusions, and threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”) (internal quotation marks and citations omitted).”

As to the first argument, that of which pleading standard applies (Rule 8 vs. Rule 9), the Court did not make a ruling.  Instead, the Court said the Plaintiffs did not meet the relaxed pleading standard of Rule 8 in any event:

“Upon review of the allegations presented in the Complaint, the Court declines to make a determination at this time as to which pleading standard should apply to Plaintiffs’ claims.  See In re Platinum & Palladium Commodities Litig., 828 F. Supp. 2d 588, 598 n.5 (S.D.N.Y. 2011) (dismissing complaint because claims were not sufficient under either the Rule 8(a) or Rule 9(b) pleading standard).  As the following analysis sets forth, even under Rule 8(a)’s more permissive standard, the Complaint fails to plead factual allegations sufficient to allow the Court to draw “the reasonable inference” that Defendants are liable for the misconduct alleged.  Cf. Iqbal, 556 U.S. at 678.  Rather, the Complaint merely pleads facts that could be “consistent with” Defendants’ liability and “stops short of the line between possibility and plausibility of ‘entitlement to relief.’”

As to the first claim, that JPM violated the Commodities Exchange Act, the Court stated, then examined the four elements that the Plaintiffs needed to show to state a claim.

“The Commodity Exchange Act prohibits any person  from “manipulat[ing] or
attempt[ing] to manipulate the price of any commodity.”  7 U.S.C. § 13.  While the term
“manipulate” is undefined in the Act, “the CFTC and the courts have developed a four-factor test to determine whether a defendant has manipulated prices.”  See Platinum & Palladium, 828 F. Supp. 2d at 598 (internal alterations omitted).  A court thus considers whether (1) the defendant possessed the ability to influence market prices; (2) the defendant specifically intended to influence market prices; (3) the alleged artificial prices exist; and (4) the defendant caused the artificial prices to exist.  See id.; see also In re Cox [1986-1987 Transfer Binder], No. 75–16, Comm. Fut. L. Rep. (CCH) ¶ 23,786, 1987 WL 106879, at *4 (CFTC July 15, 1987).”

The Court found that the Complaint alleged sufficient facts to meet the first element: “The Complaint alleges that JPMorgan “frequently held large COMEX silver short positions that were as large as the other three largest COMEX traders combined.”  (Compl. ¶ 86.)  The Complaint also states that, “from August 5, 2008 forward, JPMorgan held approximately 20-30% of the total short open interest in all COMEX contracts” and “32-40% or more of the entire short open interest.”  (Id. ¶ 86; see also id. ¶¶ 74-79.)  In light of these factual allegations, it is plausible that JPMorgan had the ability to influence prices in the silver futures market.  Cf. Parnon Energy, 2012 WL 1450443, at *10 (discussing the various ways a market participant may influence market prices).  Moreover, JPMorgan declines to challenge that it possessed the ability to influence market prices.  “

The Court found that Plaintiff’s did not allege sufficient facts to show element 2, that is, that JPM had intent to manipulate: “Moreover, as the CFTC explained in its 2004 Report, “commercial firms may legally hold futures positions for hedging or speculative
purposes.  The mere holding of speculative positions by either commercial or non-commercials is neither a violation of the CFTC or NYMEX rules, nor evidence of manipulation.”  (Davidoff Decl. Ex. A at 7.)  Thus, Plaintiffs’ general and conclusory allegation about JPMorgan’s unusual deliveries is not factually sufficient to plead that Defendants acted with the purpose or conscious object of causing or affecting a price or price trend in the market.  Cf. Harris, 572 F.3d at 72 (“[A]lthough a court must accept as true all of the allegations contained in a complaint, that ‘tenet’ is inapplicable to legal conclusions, and threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”)”

Note how the Court defers to the CFTC.  The Court is basically saying that correlation is not causation.  The Court is saying that even though JPM has a large short position, and COULD manipulate the silver market, the Plaintiffs have not shown any facts to prove that JPM manifested an intent to do so.  Price swings alone are not good enough.  This finding by the Court is pure hogwash.

But, note how the Court puts it back upon the CFTC: “as the CFTC explained . . .  the mere holding of speculative positions by either commercial or non-commercials is neither a violation of the CFTC or NYMEX rules, nor evidence of manipulation.”

See how there can never be a case then, because how can there ever be proof of intent to manipulate when JPM can ALWAYS claim that their market positions are just hedging?  Absent an insider confirming the manipulation scheme, there is no way to prove up a case. The Court says so right here: “For these reasons, Plaintiffs fail to meet Rule 8(a)’s requirement that a statement of facts do something more than “merely create[] a suspicion of a legally cognizable right of action.”  See Twombly, 550 U.S. at 555.  The Complaint here does not include factual allegations sufficient to support the reasonable inference that Defendants acted with the purpose or conscious object of causing artificial to exist silver futures prices or an artificial price trend on the COMEX market.”

As to the third element of artificiality of prices, the Court found the Complaint lacking. Once again, the Court deferred to the CFTC.  Intuitively, we all know that in order to determine whether a price is artificial requires a comparison to a real price.  So, which price is used when all markets upon which a price is known are manipulated?  What is the true price?

The Court states the rule: “Artificial prices are those prices that do not reflect the forces of supply and demand in the market or do not otherwise comport with  contemporaneous prices in comparable markets.  See In re Sumitomo Copper Litig., 182 F.R.D. 85, 90 n.6 (S.D.N.Y. 1998); In re Cox, 1987 WL 106879, at *8-9.  When determining if artificial prices exist, a court may consider the underlying commodity’s normal market forces, historical prices, supply and demand factors, price spreads, and also the cash market for the commodity at issue.  See Sumitomo Copper Litig., 182 F.R.D. at
90 n.6; (see also Pls. Mem. at 16 n.16).”  

The Court notes that the Complaint argues “artificiality” of silver future prices by trying to compare silver price changes to those of gold.  The Plaintiffs’ effort here is less than adequate, but I say how could Plaintiffs argue artificiality when the only market prices that are out there are themselves the product of manipulation?   Prices are fake because JPM manipulates prices.  JPM manipulates prices because prices are fake.  See?

I see the problem, duh, but the Complaint failed to detail how silver prices historically track gold prices, that they trade in tandem, BECAUSE THEY ARE MONEY, and when silver diverges in price from gold that leads to an inference of manipulation.  Oh well, maybe they can fix it in the next go around if they get the chance . . .

Note also the deference to the CFTC and their sham of comparing prices between the Comex and the LBMA, that bastion of fairness and transparency, to prove the “real” price: “Here, Plaintiffs claim “artificiality” on the basis that, on June 26, 2007, on August 14-15, 2008, and, between March 17, 2008 and March 25, 2010, COMEX silver futures prices “outperformed” or were “substantially” different from “the benchmark of gold prices that was used and approved by the CFTC” in its 2008 Report.  (Pls. Mem. at 16 (citing Compl. ¶¶ 9, 14- 15, 87).)  But Plaintiffs raise these allegations without first explaining why COMEX silver futures prices should be compared solely to “the benchmark of gold prices.”  Indeed, both the 2008 and 2004 CFTC Reports state that the CFTC “routinely” compares the price at which silver futures are traded on COMEX (as a division of NYMEX) with the prices at which silver futures are traded in the London Bullion Market (LBMA) and that it is the LBMA which provides “the benchmark value of silver in the marketplace.”“

So, the Court defers to the CFTC and their argument that the true price is from the LBMA.  Ha, what a farce:

“Furthermore, in the 2008 CFTC Report concluding that there had been no manipulation of the silver futures market between 2005 and 2007, the CFTC stated that
“the basis difference” between NYMEX futures prices and LBMA futures prices for this period “ranged between plus and minus 5%, . . . although on a few occasions the basis was as much as 15%.”  (Davidoff Decl. Ex. B at 8.)  During the Class Period at issue here, the average basis difference between NYMEX and LBMA prices was also approximately 5%, (see Decl. of Amanda Davidoff in Supp. of Defs. Reply Mem. (“Davidoff Reply Decl.”) Ex A (“Standardized LMBA-NYMEX Silver Basis Jan. 3, 2005 through October 27, 2010”), March 26, 2012, ECF No. 103), and this fact undercuts Plaintiffs’ claim about artificial silver prices on COMEX during this period.”

The Court further trashes Plaintiffs by again deferring to the CFTC as to price comparisons between the other precious metals, and by trotting out another straw argument, silver as an industrial metal, then concludes that Plaintiffs have shown no artificiality:  “Accordingly, the Complaint’s allegation that prices for silver—which, unlike gold, is an industrial metal—did not mirror the exact rate of price fluctuations for gold is not sufficient to support Plaintiffs’ claim that artificially manipulated silver prices existed on COMEX during the Class Period.”

The Court calls out the Plaintiffs for making a circular argument: “Plaintiffs also fail to make any showing as to how the alleged reduction of JPMorgan’s dominant short  position was tantamount to a “manipulative effect.”  Again, just because JPM COULD have manipulated price, the Court did not leap from there to the conclusion that JPM DID manipulate price by reducing their short position.  

The Court dispensed with the final “artificiality” argument [illegitimate supply factors], pointing out that this final “artificiality” argument was really a “causation” argument, and rejected it anyway: “ Plaintiffs’ final argument that artificial prices existed during the Class Period relies on allegations of “multiple, different illegitimate supply factors.”  (Pls. Mem. at 17-18.)  According to Plaintiffs, these factors “include (a) the large short position held by JPMorgan; (b) specified uneconomic trades explicitly alleged to have been made by JPMorgan at specific times of day on specific days on the COMEX; and (c) the classic manipulative device of deliveries by the dominant short, JPMorgan.”  (Id.)  These conclusory allegations, however, relate to Plaintiffs’ theories of causation, not to their claims of artificial prices.”

The Court rejected the “large short” position argument, once again, deferring to the CFTC: “More specifically, the first illegitimate supply factor that Plaintiffs cite—“the large short position held by JPMorgan,” (Pls. Mem. at 18)—is not, by itself, sufficient to support a claim of artificial prices or potentially manipulative pressure because JPMorgan’s short position on COMEX was known and permitted by the CFTC, (see Compl. ¶¶ 71-87, 129-30).

This argument is maddeningly circular!  Does this not drive one crazy!?  Here, this Court says that a large short position is potentially manipulative, but since the CFTC allows it, it cannot support an argument of artificiality.  However, when the CFTC implements position limits, another Court throws out the position limits because there is no showing that position limits prevent manipulation.  WTF?!  Does anyone else see the futility in seeking Federal Court assistance as to stopping the Comex fraud?

The Court rejected another argument: “Plaintiffs’ second argument about illegitimate supply factors is similarly weak.  (See Pls. Mem. at 18.)  The allegation that large unspecified and “uneconomic” trades were taking place on the COMEX during the more than two-and-a-half year Class Period is too general to plead the existence of artificial prices.”  To plead this better would require facts showing that JPM is acting at the behest of the Fed govt to artificially suppress silver prices to support the fiat FRN scheme.  Who is going to testify to this? <crickets>   Exactly.

The final artificiality argument failed as well: “Plaintiffs’ final “illegitimate supply factor” allegation—that Defendants used “the classic manipulative device of deliveries by the dominant short, JPMorgan,” (id.)—also does not show that JPMorgan created artificial prices.  As discussed supra, the sections in the Complaint upon which Plaintiffs rely (see Pls. Mem. at 18 (citing Compl. ¶¶ 2-12, 68-87, 96-120, 121-28, 130, 138-74)), to support their claim of an illegal supply factor on the basis of “unusual deliveries” fail to identify the timing or volume of any delivery by JPMorgan during the Class Period, and without these additional factual allegations, Plaintiffs’ illegal supply factor claim is insufficiently pled, (see Op. & Order, Section V.A.3(b)).”

Here, how are Plaintiffs supposed to get facts regarding “unusual deliveries” without being given information from JPM through discovery?  So the Court denies Plaintiffs the right to dig into this very factual information which could prove unusual deliveries and prove this element, then has the temerity to claim that Plaintiffs have not plead this element sufficiently?  This is a no win situation.  This is also a clear statement that the Court has no intention of allowing Plaintiffs to make out their case by turning lawyers loose with discovery of JPM.

Finally, as to the fourth element of causation, the Court found the Complaint did not plead facts to show that even if JPM had the ability to manipulate prices, and even assuming that there were artificial prices,  that nevertheless, JPM’s conduct CAUSED any price artificiality:

“The causation element requires that a defendant be the proximate cause of the price
artificiality.  See In re Cox, 1987 WL 106879, at *12; see also DiPlacido v. CFTC, 364 F. App’x at 661-62.  Here, Plaintiffs argue two theories of causation: causation by JPMorgan’s large short position and causation by JPMorgan’s large uneconomic trades.”

The Court rejected the first argument, which in hindsight, is EASY to call.  The Plaintiffs are just making a circular argument from a logic leap without proof.  We all know it, believe it, but one cannot just say that JPM has a large short position, and therefore, they caused the market price to be fake.  Here is the Court’s language:

“Under their first theory, Plaintiffs point to allegations in the Complaint of the approximate size of JPMorgan’s short position at certain dates and the percentage that the position constituted in the silver futures market.  (See Pls. Mem. at 19-20 (citing Compl. ¶¶ 3-7, 51, 55-87, 110-20, 131, 133).)  Plaintiffs then ask this Court to infer that “[b]ecause JPMorgan held such a large dominant short position, it is difficult to imagine anyone else, working alone, who had the ability to cause such large declines in prices which, clearly, benefitted JPMorgan at least three times more than it benefitted any other trader.”  (May 21, 2012 Letter from Pls. to the Court at 3 (emphasis added).)  However, the “imagination” required to link these conditions, without corroborating factual allegations as to trades, sworn affidavits, or other evidence is tantamount to impermissible speculation on the basis of sheer possibility.  Cf. Iqbal, 556 U.S. at 678 (While “[t]he plausibility standard is not akin to a probability requirement, . . . it asks for more than a sheer possibility that a defendant acted unlawfully.”)”

The Court rejects Plaintiffs arguments, claiming that Plaintiffs should have set forth “specific factual allegations.”  But, how are Plaintiffs supposed to get these insider facts, unless they get source documents, which the Court said that Plaintiffs cannot have access to?

Look at this unfairness, requiring Plaintiffs to prove information exclusively within the knowledge of JPM, and that once again, the Court is deferring to the CFTC: “Plaintiffs’ second theory that JPMorgan caused artificial prices by making large uneconomic trades on June 26, 2007, August 14-15, 2008, and at other times during the Class Period is no more successful.  First, without more specific factual allegations as to the amounts and to the timing of certain trades, Plaintiffs’ claim that JPMorgan submitted an unknown number of “sell orders” when silver prices were high and an unknown number of “purchase orders” when prices fell, (see, e.g., Compl. ¶¶ 55, 58), indicates no more than normal, rational market participation by JPMorgan.  Indeed, the CFTC’s 2005-2007 investigation considered the trades made on June 26, 2007 and determined that the market was free of manipulation at that time.  (See Davidoff Decl., Ex. B at 1.)”

And here: “ Secondly, the portions of the Complaint that discuss the August 14-15, 2008 silver price fluctuations rest on the conclusion that JPMorgan “must have” caused the fluctuations and high trading volume because no other “information coming to the silver market” explained the price behavior at that time.  (Compl. ¶ 115.)  The Complaint’s descriptions of other uneconomic trades allegedly made during the Class Period similarly fail to allege specific conduct that might be reasonably attributed to JPMorgan.”  Again, on this, note how correlation [price fluctuations] does not equate to causation [JPM caused price fluctuations] strictly because of the absence of some other explanation.  How else are Plaintiffs supposed to prove causation without getting the details of the actual JPM trades?  Who is going to be able to put all of this together if not JPM employees testifying under oath, and being forced to explain trades and positions?

The Court rejected the “whistleblower” allegations, too.  No surprise there.  Where is this witness or witnesses?  Why was there no declaration from an insider, setting this all front and center?  Were the witnesses too afraid to go on record?  Are there even any witnesses?  Who knows?  I said as much here to Mr. Ferguson as well, namely, that making an unsourced claim is risky, because it calls one’s credibility into account. In court, we lawyers are trained to focus on cross examination.  Without it, there is no reliability upon what is being stated, absent blind faith.  One who withstands cross examination is more believable, simply that.  

Here is what the Court said:

“Moreover, the statements made by the unidentified “market professional,” (Compl. ¶¶
121-23), by the unnamed “whistleblower,” (id. ¶¶ 125-26), and by the “bragging” JPMorgan traders, (id. ¶ 176), are not sufficiently factual to show that JPMorgan was the proximate cause of the price fluctuations during the Class Period.  The unidentified market professional, for example, is alleged to have brought a series of trades to the attention of the CFTC, but the market professional is not alleged to have named JPMorgan as a party to these trades.  (See id. ¶ 122.)  Indeed every one of the market professional’s statements are made in the passive voice alleging that, “there was heavy selling of silver and gold;”“[t]here were large sellers who came into both the gold and silver markets to drive the prices down;” and so on.  (Id.)”

And there is more here: “By comparison, the unnamed whistleblower who contacted the CFTC in November 2009 does specifically name JPMorgan, but only to assert conclusory and speculative allegations that JPMorgan and its co-conspirators “manipulate[d] and suppress[ed] the price of COMEX silver futures and options contracts.”  (Id. ¶ 123; see also id. ¶¶ 124-127.)  The Complaint alleges no other information about this whistleblower or about the details of the manipulation that the whistleblower is purported to have observed.  Indeed, the whistleblower’s statement is itself speculative as to JPMorgan’s role in the causation: “[h]ow would th[e price fluctuations] be possible if the silver market was not in the control of [JPMorgan and its co-conspirators] . . . . ?”  (Id. ¶ 127 (alterations made in Complaint).)”

And here: “For the reasons discussed supra, the statements by the “bragging” JPMorgan traders are also insufficient to support the allegation that JPMorgan caused artificial prices in the COMEX silver futures market.  (See Op. & Order Section V.A.3(b).)  The Complaint alleges no information about the date or the language of the remarks deemed to be “bragging;” the identity of the traders who made these remarks; which of the many trades that took place over the two and-a-half year Class Period were the subject of the traders’ bragging; and no information about whether the traders were acting at the instigation of JPMorgan to move silver prices on the market.  Cf. Harris, 572 F.3d at 72 (stating that “legal conclusions, and threadbare recitals of the elements of a cause of action, supported by mere conclusory statements” are not entitled to presumption of truth).”  Once again, the Complaint claims that there are witnesses to all of this; yet, not a single person, date, or linkage to JPM is made.  Why not?  Who is being protected?  Are these truths, or rumors?  The Court said in essence, “we do not have to treat unsourced information as real, and instead, we treat it as useless.”  I say that too, because there is NO WAY to cross examine an unsourced statement by some nameless person.  So why did the Complaint not set this person or persons forth, and go into details? Maybe they will take another crack at it?

The Court similarly rejected the Saxo bank platform argument too, finding no credible sourcing for the allegations, and rejected them as speculation.  Discovery here would be nice, but absent an insider, willing to go on record, there is no way to connect this to JPM at this point in time.

Thus, the Court found this: “Accordingly, neither of Plaintiffs’ theories is sufficient to show plausibly that any actions by Defendants were the proximate cause of artificial prices on the COMEX during the Class Period as required under Rule 8(a).  Cf. In re Cox, 1987 WL 106879, at *12 (“If the multiple causes [of an artificial price] cannot be supported out, or if the respondents are not one of the proximate causes, then the charge of manipulation cannot be sustained.”)”

The Court then summarized the ruling dismissing the claim: “the Complaint merely pleads facts that might be “consistent with” Defendants’ liability and it “stops short of the line between possibility and plausibility of ‘entitlement to relief.’”   So here we are: we know that JPM COULD be manipulating silver prices, that there are facts all of which are consistent with such conduct, BUT, right now, there are just not enough facts to show that JPM ACTUALLY IS manipulating silver prices.  So how are Plaintiff’s supposed to find out more facts unless the Court allows discovery?  Dead end.

As for the Plaintiffs’ claim of aiding and abetting, since there is no proof of JPM’s intent to manipulate, there can be no claim for aiding and abetting: “As a matter of law, where a complaint fails to allege the requisite intent of any primary actor to manipulate a market, that complaint also fails to state a claim for aiding and abetting liability in violation of Section 22 of the Commodity Exchange Act.  See Platinum & Palladium,
828 F. Supp. 2d at 599.  Here, Plaintiffs have failed to state a claim for market manipulation by a principal, (see supra, Section V(A)), and thus have also failed to state that Defendants are liable for knowingly aiding and abetting a market manipulation.”

As for the Sherman Act claim, the Court threw this one out as well.  “Under Section 1 of the Sherman Antitrust Act, “[e]very contract, combination[,] . . . or conspiracy, in restraint of trade or commerce . . . is declared to be illegal.”  15 U.S.C. § 1.  To state a claim under Section 1, a plaintiff must provide plausible grounds to show that the “challenged anticompetitive conduct stems from independent decision or from an agreement, tacit or express.”

Once again, the Court focused on the lack of proof of an actual conspiracy, noting that despite some factual detail, the Complaint lacked any semblance link to JPM or proof of any conspiracy.  “The Complaint fails to state sufficient factual allegations as required
by Twombly to show the existence of an actual conspiracy to manipulate the price of COMEX silver futures and options.  Cf. Twombly, 550 U.S. at 556-57. Plaintiffs’ claim that Defendants violated Section 1 of the Sherman Antitrust Act is therefore dismissed.”

So, there you have it.

CALawyer

135 Comments

flaunt's picture

Maybe JPM is manipulating and

Maybe JPM is manipulating and maybe they aren't...

I don't research this issue because I think it clouds the overall picture for why people should be buying/trading/investing in silver and silver related products.  They'll likely never "prove" manipulation and they'll never "disprove" it so the whole thing is kind of pointless.  Even if they managed to prove it, what would happen?  JPM would get a fine of a hundred million dollars when they made billions and billions on the fraudulent transactions.  That's how these markets work.  The fines are levies for playing the game rather than actual penalties designed to promote fair markets.

Dismissing this suit is a great way to start 2013.  I challenge everyone to make a new years resolution to dismiss the thought of silver manipulation and instead focus on the fundamentals, technicals, and other factors that actually drive price action.  Remove the invisible nefarious hand and keep a clear head.

Dr Jerome's picture

How about seconds, Timmy?

Mmmmm. Slow roasted mutton.

Bollocks's picture

Bacon's flat?

I'll drink to that!

abguy4's picture

@ Ancient Money

That is worth repeating until it sinks in;

"We'll know our dis-information program is complete when everything the US public believes is false."
-William J. Casey, 1981

We are there now.

For those who don't know, William J. Casey was Director of the CIA from 1981-1987.

AND, lest ye forget, who was CIA Director 1976 - 77 ??

O Golly Gee , it was Big Daddy G.H.W. Bush. Yes , he of Iran-Contra fame .

Just exactly how did he ever get to the presidency without ever having won a campaign,

until the republocrats appointed/anointed/canonized him??

Just asking..............

Do yah think these people know something??
Let me know when you smell a cabal.

When I was a little kid, I always wondered how the German people felt as they were led to war, and whatever possessed them. Now, I know. Just look around. Hitler's propaganda machine used the terrorist card too. The terrorists then were the Polish. Are you kidding me??? A fourth world country that could not even feed itself??? Let me know when any of this sounds familiar.

Now, one of my favorites;

Head of the HSA Michael Chertoff. When it looks like a Nazi, talks like a Nazi, acts like a Nazi, it just might be a Nazi.

Or, maybe it's yur lying eyes again.

Michael%2BChertoff.jpg

Bollocks's picture

ZH

India FinMin: "Demand For Gold Must Be Moderated"

Tyler Durden's picture

As we wondered out loud yesterday, many have questioned the disconnect between increasingly burgeoning central bank balance sheets and money printing and the range-bound trading in Gold. It seems the first real hint of why is peeking through as the Economic Times reports the Indian government are growing increasingly concerned at the rate of gold imports. As the India Finance minister stated: "Demand for gold must be moderated... We may be left with no choice but to make it more expensive to import gold. The matter is under government consideration." Gold imports are playing a major part in India's record high current-account deficit (at $20.2bn for the period April to September), down 30.3% YoY thanks to a doubling of the customs duty on standard gold bars (to 4%). It seems the Indian powers-that-be are learning from their US and European leaders that if something is happening in a free-market that threatens the status quo even modestly - crush it with regulation and centrally-planned control. As the article goes on to note, currently, the government is also making efforts to channelise investor money into equities and other financial instruments to reduce demand for the yellow metal.

http://www.zerohedge.com/news/2013-01-02/india-finmin-demand-gold-must-be-moderated

Mr. Fix's picture

Oops, the world didn't end (yet).....

My mea culpa to "Turdville":

The powers that be have seen fit to extend us a little bit more time to accumulate what we need to survive what is coming.

I have no doubt that this is not out of concern for our welfare, but for theirs.

We have "graciously" been given a month or two, but in the meantime the damage is still being inflicted.

Not only has nothing been "fixed", but the damage to our nation is accelerating.

Granted, the metals may be up today, but the Evil Empire is still firmly in control of the price.

Out of the various antidotal reports on some of the previous pages of this thread, shortages seem to be real, and increasing.

Predicting an exact timeline of the “end of the great Keynesian experiment” is problematic at best.

It can literally be at any moment, but there is most certainly a finite amount of time that it can be pushed into the future,

And that amount time is quickly dwindling.

Seeing as that I am still a “working stiff” with many bills to pay, I am off to work today to try and create something that resembles a “normal life" for my family and I.

See you all tonight,

as usual, not only will I be thinking about the world's circumstances all day long,

I may in fact have much to say about it.

Some things never change.wink

The Swedish Chef's picture

The case against JPM was

The case against JPM was dropped? Look at my surprised face...

We all knew this and at some level it´s a good thing. The more people realize that out political and legal systems are a sham worldwide, the better. If this had gone forward, it would have been a hefty kick on a can that needs to be stopped. 

Xeno's picture

Anyone Believe

Does anyone really believe that just because they could that they really wouldn't?

Nah, that'd take much too much integrity.

FWIW,  from; http://rense.com/general95/essential.html

Essential CRITICAL FACTS For
All Americans To Read

From Dr Leonard Coldwell
12-29-12

 
 

HERE ARE FACTS MOST DON'T KNOW, BUT SHOULD...

1. The IRS is not a US government agency. It is an agency of the IMF (International Monetary Fund) (Diversified Metal Products v I.R.S et al.
CV-93-405E-EJE U.S.D.C.D.I., Public Law 94-564, Senate report 94-1148 pg. 5967, Reorganization Plan No. 26, Public Law 102-391)

2. The IMF (International Monetary Fund) is an agency of the U.N. (Black's Law Dictionary 6th Ed. page 816)

3. The United States has NOT had a Treasury since 1921 (41 Stat. Ch 214 page 654)

4. The U.S. Treasury is now the IMF (International Monetary Fund) (Presidential Documents Volume 24-No. 4 page 113, 22 U.S.C. 285-2887)

5. The United States does not have any employees because there is no longer a United States! No more reorganizations. After over 200 years of bankruptcy it is finally over. (Executive Order 12803)

6. The FCC, CIA, FBI, NASA and all of the other alphabet gangs were never part of the U.S. government, even though the "U.S. Government" held stock in the agencies. (U.S. v Strang, 254 US491 Lewis v. US, 680 F.2nd, 1239)

7. Social Security Numbers are issued by the U.N. through the IMF (International Monetary Fund). The application for a Social Security Number is the SS5 Form. The Department of the Treasury (IMF) issues the SS5 forms and not the Social Security Administration. The new SS5 forms do not state who publishes them while the old form states they are "Department of the Treasury". (20 CFR (Council on
Foreign Relations) Chap. 111 Subpart B. 422.103 (b))

8. There are NO Judicial courts in America and have not been since 1789. Judges do not enforce Statutes and Codes. Executive Administrators enforce Statutes and Codes. (FRC v. GE 281 US 464 Keller v. PE 261 US 428, 1 Stat 138-178)

9. There have NOT been any judges in America since 1789. There have just been administrators. (FRC v. GE 281 US 464 Keller v. PE 261 US 428 1 Stat. 138-178)

10. According to GATT (The General Agreement on Tariffs and Trade) you MUST have a Social Security number. (House Report (103-826)

11. New York City is defined in Federal Regulations as the United Nations. Rudolph Guiliani stated on C-Span that "New York City is the capital of the
World." For once, he told the truth. (20 CFR (Council on Foreign Relations) Chap. 111, subpart B 44.103 (b) (2) (2) )

12. Social Security is not insurance or a contract, nor is there a Trust Fund. (Helvering v. Davis 301 US 619 Steward Co. v. Davis 301 US 548)

13. Your Social Security check comes directly from the IMF (International Monetary Fund), which is an agency of the United Nations. (It says "U.S.
Department of Treasury" at the top left corner, which again is part of the U.N. as pointed out above)

14. You own NO property. Slaves can't own property. Read carefully the Deed to the property you think is yours. You are listed as a TENANT. (Senate Document 43, 73rd Congress 1st Session)

15. The most powerful court in America is NOT the United States Supreme court, but the Supreme Court of Pennsylvania. (42 PA. C.S.A. 502)

16. The King of England financially backed both sides of the American Revolutionary War. (Treaty of Versailles-July 16, 1782 Treaty of Peace 8 Stat 80)

17. You CANNOT use the U.S. Constitution to defend yourself because you are NOT a party to it! The U.S. Constitution applies to the CORPORATION OF THE UNITED STATES, a privately owned and operated corporation (headquartered out of Washington, DC) much like IBM (International Business Machines, Microsoft, et al) and NOT to the people of the sovereign Republic of the united States of America. (Padelford Fay & Co. v The Mayor and Alderman of the City of Savannah 14 Georgia 438, 520)

18. America is a British Colony. The United States is a corporation, not a land mass and it existed before the Revolutionary War and the British Troops did not leave until 1796 (Republica v. Sweers 1 Dallas 43, Treaty of Commerce 8 Stat 116, Treaty of Peace 8 Stat 80, IRS Publication 6209, Articles of Association October 20, 1774)

19.

20. Britain is owned by the Vatican. (Treaty of 1213)

21. The Pope can abolish any law in the United States (Elements of Ecclesiastical Law Vol. 1, 53-54)

22. A 1040 Form is for tribute paid to Britain (IRS Publication 6209)

23. The Pope claims to own the entire planet through the laws of conquest and discovery. (Papal Bulls of 1495 & 1493)

24. The Pope has ordered the genocide and enslavement of millions of people.(Papal Bulls of 1455 & 1493)

25. The Pope's laws are obligatory on everyone. (Bened. XIV., De Syn. Dioec, lib, ix, c. vii, n. 4. Prati, 1844 Syllabus Prop 28, 29, 44)

26. We are slaves and own absolutely nothing, NOT even what we think are our children. (Tillman vs. Roberts 108 So. 62, Van Koten vs. Van Koten 154 N.E. 146, Senate Document 438 73rd Congress 1st Session, Wynehammer v. People 13 N.Y. REP 378, 481)

27. Military dictator George Washington divided up the States (Estates) in to Districts (Messages and papers of the Presidents Volume 1 page 99 1828 Dictionary of Estate)

28. "The People" does NOT include you and me. (Barron vs. Mayor and City Council of Baltimore 32 U.S. 243)

29. It is NOT the duty of the police to protect you. Their job is to protect THE CORPORATION and arrest code breakers. (SAPP vs. Tallahassee, 348 So. 2nd. 363, REiff vs. City of Phila. 477 F. 1262, Lynch vs. NC Dept. of Justice 376 S.E. 2nd. 247)

30. Every thing in the "United States" is up for sale: bridges, roads, water, schools, hospitals, prisons, airports, etc, etc... Did anybody take time to check who bought Klamath Lake?? (Executive Order 12803)

31. "We are human capital” (Executive Order 13037) The world cabal makes money off of the use of your signatures on mortgages, car loans, credit cards, your social security number, etc.

32. The U.N. - United Nations - has financed the operations of the United States government (the corporation of THE UNITED STATES OF AMERICA) for over 50 years (U.S. Department of Treasury is part of the U.N. see above) and now owns every man, woman and child in America.

The good news is we don't have to fulfill "our" fictitious obligations. You can discharge a fictitious obligation with another's fictitious obligation.

These documents are not secret. They are a matter of public record.

Simple words such as "person" "citizen" "people" "or" "nation" "crime" "charge" "right" "statute" "preferred" "prefer" "constitutor" "creditor" "debtor" "debit" "discharge" "payment" "law" and "United States" doesn't mean what we think it does because we were never taught the legal definitions of the above words.

The illusion is much larger than what is cited.

Dr Leonard Coldwell
Board Certified NMD DNM PHD D.HUM LCHC CNHP DIP.PHC
www.drleonardcoldwell.com

Fraud in the inducement comes to mind.

So It Goes's picture

Improved mood

Nice to see the improved mood around here.

A little pop in the metals will do that.

Keep stacking.

Groaner's picture

Silver rises the fastest and also falls the fastest

almost a .50 drop from the high

Green Lantern's picture

Thanks CaliLawyer

Might be time to take golf up again.  At least I am responsible for hitting on my own balls in the sand trap and can't blame it on anybody else.

¤'s picture

Kudos to CA Lawyer

Great job as always!

The takeaway from this is that JPM is 'the fence' and a long tenured 'agent' of the Govt. and will never allow itself to be brought down in the manner some have thought possible.

I've called it "business as usual" and thats what its been since JPM & friends helped bailout and build this country since the late 1800's. They own a piece of the pie and literally have a vested interest thats always been there and still remains.

It might be time for some to recognize what you're up against because there is no fighting the U.S. Treasury/Fed. and there's a reason that phrase was coined long ago by smart/big money.

Business as usual. Prepare and plan accordingly.

Groaner's picture

YUP the Old 10AM fall time

Both metals peaked at 10AM and have dropped since.. From 10-10:30 you can count on it.

Also the metals were falling much sooner than the USD started up.. what does that tell you.??

Green Lantern's picture

Ever tried making a deposit

Ever tried making a deposit at JPM.  This is exactly what happens?

Juan Moment's picture

Thanx CALawyer

Nice work CALawyer, much appreciated. So if I understand you right, then in essence the case was dismissed as the court sees the CFTC as the party tasked with determining if there was indeed illegal manipulation, and since those lame arses haven't done so, Justice Patterson washes his hands.

The Court found that Plaintiff’s did not allege sufficient facts to show element 2, that is, that JPM had intent to manipulate: “Moreover, as the CFTC explained in its 2004 Report, “commercial firms may legally hold futures positions for hedging or speculative
purposes.  The mere holding of speculative positions by either commercial or non-commercials is neither a violation of the CFTC or NYMEX rules, nor evidence of manipulation.”

In a nutshell, since Gary G & Bartners are as useless as tits on a bull, what makes a free market free is the fact that JPM is free to do as it pleases. Ah well, when one takes into account the actual purpose of our courts, protecting the status quo, and looks at those stuck-up characters in their ridiculous black robes, courts are the least likely place to find justice, not to mention decisions that would rattle the cage.

The German High Court waved through the Euro bailout plans in clear contravention of their Grundgesetz, the whole Euro project is a timeline of broken laws and agreements, yet no court feels responsible. And if due to growing public pressure they are forced to take position, whatever laws need to be reinterpreted or ignored to keep the current plutocratic system alive, will be reinterpreted and ignored.

Why would the families on top of the pyramid, who so meticulously ensured they own the mainstream media, the energy, agriculture and pharma industry, employing an army of lobbyists to control Washington and Brussels, neglect to buy the courts? Answer is: They didn't.

gearhead_24's picture

Thanks CALawyer...

for your input.  Great summary on the events.  Input like this is one of the best reasons I come to this site.

Thanks TF for all you do to pull this site together.

GH

Dr Jerome's picture

Off to my LCS

OK guys and gals,

My coin guy just called and made me an offer I could not refuse.

I am off the the LCS to BTFD  LOL!

Pic and price forthcoming upon my return.

sure beats grading papers.

Excalibur's picture

Happy Birthday

to thurd aye

Birthday Cake With Candles With Number One, Isolated On White Background, Vector Illustration

Hope you are feeling better today.

AC_Doctor's picture

Repackage lawsuit, add details then sue the CTFC...

Repackage this lawsuit, add details then sue the CTFC for not protecting the American People...

AC

Swineflogger's picture

Thought For The Day

      FIVE RULES TO REMEMBER IN LIFE:

1. Money cannot buy happiness, but it's more comfortable to cry in a Mercedes than on a bicycle.

2. Forgive your enemy, but remember the bastard's name.

3. Help someone when they are in trouble and they will remember you when they're in trouble again.

4. Many people are alive only because it's illegal to shoot them!

5. Trying to debate with Obama voters is like trying to pick up a turd by its clean end.

Hrunner's picture

Thank you, Cal Lawyer

I feel as saddened as many by the utter lack of courage, morality and integrity in our system.

You should feel proud, because even though you may not be able to divert the course of the Titanic, I have a strong sense that the courageous documentation that you and others here provide in these pages will tell the future generations that good people stood against what was wrong.

Great movements start with just a few people willing to stand and speak truth.  Sometimes just stand.

13 Be on your guard; stand firm in the faith; be courageous; be strong. 14 Do everything in love.

1st Corinthians 16:13, 14

thurd aye's picture

That's a bloody big cake!

That's a bloody big cake! Thanks.;O))

Big Buffalo's picture

Good Day.

That's is all.

steveo's picture

Free 10 ounce Silver

Free 10 ounce Silver contest.  The new contest is posted!!!!!!!!

Enter early, only the first correct price gets the bar.

I did 35.21 (so don't use that one, right?)

Use the link on the side of my blog

http://oahutrading.blogspot.com/2013/01/new-silver-contest-is-open-10-ounce-bar.html

ratioarbitrage's picture

Fractals

The last 16 hours in silver matches the last four years. I am not predicting anything, but that is just cool.

PS: the charts match much better if you use a log rather than linear scale.

Dracula's picture

Playing the game is like

Not for weak hearts.

bbacq's picture

A last-gasp-hope for rule of law?

Thanks, CAlaw.  Recently I bumped into the common-law concept of "jury nullification", wherein a jury delivers a "not guilty" verdict, despite all conditions for a guilty verdict being met.  Essentially it is a statement by the jury that the law is an ass.  It might be all that is left...

Too bad the opposite can't happen - I don't think it would be hard to find a dozen folk who thought Dimon/Corzine/insert-your-favourite was guilty of something, even if "innocent under the law".

In Canada there is precedent for jury-nullification preceding change in statute, in the case of abortion law, for example.  But I have read that it is illegal (in Canada) for defense counsel to inform the jurors of this right (and, in fact, their moral obligation to nullify in the case of bad law).

Having had a taste, I for one would be interested in CALaw's review of this case in New Jersey.

Happy New Year!

bbacq

S Roche's picture

At the risk of...

forever being branded a troll:

When I read the plaintiff's submission I thought it was drivel, very poorly constructed and inaccurate, (with respect to its reference to Andrew Maguire's background), however, generally being in favor of anything against JPM and having very little experience of the US Court system I thought maybe this is what passes for a properly submitted lawsuit. Seems they fell at the first hurdle.

Now...here comes the forever-branded-a-troll part: Victor was right about this case.

القراع عصفور's picture

Now...here comes the forever-branded-a-troll part:

Now... here comes the part where I say,"shut the fuck up troll" :-)

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