LONDON (Reuters) -Barclays on Friday won its bid to more than halve a shareholders’ lawsuit worth up to 560 million pounds ($727 million) at London’s High Court for allegedly misleading the market about its private “dark pool” trading platforms.
A judge ruled that investors who only relied on Barclays share value or listed status could not continue with their claims, and said he hoped this would improve the chances of an early settlement.
Hundreds of institutional investors are suing after more than 2 billion pounds was wiped off Barclays’ value in 2014, when New York’s attorney general filed a complaint against the lender over a trading system known as “Barclays LX”.
The investors say Barclays misled its clients about Barclays LX – a “dark pool” trading venue where orders are not visible to other traders until they are executed – and that the bank did not publish relevant information to shareholders.
Barclays applied in July for more than half of the case – representing some 330 million pounds of its total value – to be thrown out, which Judge Thomas Leech allowed on Friday.
The bank’s lawyer Helen Davies argued that it was essential in a shareholder lawsuit that claimants had relied on information published by a listed company.
This meant, she argued, that claims by investors who said they relied only on Barclays’ share value or listed status could not continue.
Leech said the parts of the claims relating to those who relied on Barclays’ status as a listed company or its share price “involve 241 different funds and have a total value of £332 million which is 60% of the total value of the claims”.
“If I dispose of those claims on a summary basis, this ought to reduce the scope of the claims considerably and promote an early settlement,” Leech ruled. “I will, therefore, do so.”