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Atty's Metal Manipulation Claims Are Untimely, 2nd Circ. Says

The Second Circuit on Thursday upheld a lower court’s finding that an attorney’s lawsuit alleging chemical company BASF Corp. and several financial institutions manipulated the platinum and palladium markets was filed too late.

Susan Levy, an attorney who traded futures contracts, brought her lawsuit against BASF and several banks, including Goldman Sachs, seven years after she suffered losses tied to the alleged market manipulation, according to the three-judge panel. The statute of limitations is two years for the Commodity Exchange Act claims she brought and four years for her Racketeer Influenced and Corrupt Organizations Act and Sherman Act claims.
“Levy had actual notice of her injuries in 2008 when she was forced to pay a margin call and lost her entire investment,” the panel said. “Therefore, Levy’s complaint, which she did not file until 2015, was not timely.”
Levy first filed a lawsuit over the alleged manipulation in 2012, but those claims were resolved two years later, according to court documents. She filed a new complaint in 2015, based largely on information in a proposed class action brought in 2014 that she claimed illuminated the real cause of her losses.
The proposed class action alleged financial institutions manipulated prices of platinum and palladium futures contracts traded on the New York Mercantile Exchange, benefiting themselves while harming investors. In her own 2015 complaint, Levy said she suffered losses after the alleged misconduct caused the value of platinum futures she had purchased to sharply decline.
But U.S. District Judge Gregory Woods said in 2017 that the proposed class action doesn’t change the fact that Levy discovered her injury in 2008, making all the claims alleged in her most recent complaint untimely.
The Second Circuit affirmed Judge Woods' reasoning Thursday.
“The district court concluded that Levy’s previous complaint, which she filed in 2012 asserting various claims based on the same financial losses at issue here, demonstrated that she was aware that she had been injured and that she was capable of pursuing her legal remedies,” the panel said. “We agree with its analysis.”
Counsel for the parties didn’t respond Thursday to requests for comment.
U.S. Circuit Court Judges Ralph Winter and Rosemary Pooler and U.S. District Court Judge Ronnie Abrams, sitting by designation, sat on the panel for the Second Circuit.
Levy is representing herself.
BASF is represented by Michael Williams and Peter Farrell of Kirkland & Ellis LLP. HSBC is represented by Damien Marshall, Leigh Nathanson and Laura Harris of Boies Schiller Flexner LLP. Goldman Sachs is represented by Stephen Ehrenberg of Sullivan & Cromwell LLP. ICBC is represented by Robert Houck of Clifford Chance US LLP. UBS is represented by Eric Stock, Mark Kirsch, D. Jarrett Arp, Melanie Katsur and Indraneel Sur of Gibson, Dunn & Crutcher LLP. The London Platinum and Palladium Fixing Company is represented by Morgan Feder of Dechert LLP.
The case is Susan Levy v. BASF Metals Ltd. et al., case number 17‐3823, in the U.S. Court of Appeals for the Second Circuit.