BNP Faces New Front in $188 Million ‘Fat-Finger’ Suit by Trader

(Bloomberg) -- A trader who wants BNP Paribas SA to pay him 163 million euros ($188 million) over a “fat-finger” mistake is betting that Paris judges will help him avoid having to give up most of the claim.

The German trader, who can only be identified as Armin S., originally sued BNP in Frankfurt but in September limited his claim to 6 million euros to avoid the risk of paying costly legal fees. Shortly before the end of the year, he came up with a new strategy to keep the full claim alive: he sued BNP in Paris, seeking 152 million euros.

Armin S. says he’s not venue shopping, but rather relying on Paris judges to stay his case until their German counterparts issue an initial ruling. He’s counting on European laws saying if the same case is filed in different countries, the court which gets the issue first needs to decide the proper jurisdiction while the other waits.

It’s the waiting period Armin S. is betting on. Staying the French case would preserve the 152 million-euro part of claim, which otherwise could have elapsed under the German statute of limitations, he said.

BNP spokeswoman Heike Bertus-Stoever declined to comment.

The European Union has rules designed to sort out what happens if suits over the same issue are filed in separate member states. While the legislation aims to determine which country takes the lead, litigators also use them strategically. Porsche SE in 2012 rushed to keep a lawsuit in its home country by filing a case in Stuttgart days before a hedge fund could sue the company for $195 million in London. Porsche sought to avoid the much broader discovery rules in U.K. courts.

The trader is trying to get BNP to honor a December 2015 transaction where he found a typing error on the bank’s system that allowed him to order a derivative for 326,400 euros instead of 163 million euros. The pricing system displayed the securities for 108.80 euros instead of 54,400 euros each. The mistakes weren’t noticed until a week after his trade.

His Frankfurt suit, filed in 2017, originally sought 1 million euros because he was hoping for a quick ruling that would have allowed him to easily collect the rest of his claim. When that didn’t work out by the end of last year, the trader was facing Germany’s three-year statute of limitations on claims and a tough choice. He had to either file for the full 163 million euros -- exposing himself to massive legal costs if he lost -- or stand pat with the 1 million euros.

He settled to go after 6 million euros in his home country’s court -- and to file for another 152 million euros in France.

To contact the reporter on this story: Karin Matussek in Berlin at kmatussek@bloomberg.net

To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Christopher Elser, Peter Chapman

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