BNP Wins Dismissal of $186 Million ‘Fat-Finger’ Trader Suit
(Bloomberg) -- BNP Paribas SA won dismissal of a German lawsuit by a trader seeking 163 million euros ($186 million) for a “fat-finger” mistake in a 2015 transaction.
The Frankfurt Regional Court on Feb. 26 ruled it can’t look into merits of the case, which involved an error on the bank’s system that displayed derivatives priced at 108.80 euros each instead of 54,400 euros each. Judges held the investor should have sued in France rather than Germany, a spokeswoman for the tribunal said Thursday.
While the trader, who can only be identified as Armin S., invoked an agreement between his broker and BNP which would allow to litigation of this type of disputes in Frankfurt, he bought the securities over a platform that wasn’t covered by the rules, according to the German judges. Armin S. has already filed a suit against BNP in a Paris court.
BNP confirmed the judge rejected the suit but wouldn’t comment further. Armin S.’s lawyer, Mario Boegelein, said he need to see the written before commenting.
Armin S. in September limited his Frankfurt case to 6 million euros to avoid the risk of a huge bill under Germany’s litigation rules that make the loser pays all legals fees. Shortly before the end of the year, he came up with a new strategy to keep the full claim alive and sued in Paris, seeking 152 million euros.
The trader is trying to get BNP to honor the December 2015 transaction where he found a pricing error on the bank’s system that allowed him to order a derivative for 326,400 euros instead of 163 million euros. The mistakes weren’t noticed until a week after his trade. Armin S. alleges that BNP tried to correct the mistake too late, and must now pay.
The German case is: LG Frankfurt am Main, 2-18 O 175/17.
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