Elliott Associates is considering further action against the London Metal Exchange (LME) following a fine on the exchange by a watchdog last week for allowing nickel prices to surge out of control three years ago, the US-based hedge fund said on Monday.
Elliott lost a lawsuit against the exchange for cancelling billions of dollars of nickel trades after the price hit a record above $100,000 a tonne in March 2022, prompting the LME to suspend nickel trading.
Elliott said in an emailed statement that it was vindicated after Britain’s regulator the Financial Conduct Authority last week fined the LME 9.2 million pounds in the first ever enforcement action against a UK exchange.
“The FCA’s final notice of March 20, 2025 has confirmed that Elliott was correct. The LME’s failures caused material financial harm to many investors, including Elliott,” Elliot said.
“Elliott is carefully reviewing the FCA’s final notice and is considering what further action, if any, it may take in this matter.”
Elliott did not give details of what further action it was considering.
Last October, Elliott lost an appeal against the dismissal of its lawsuit against the LME for the cancelled nickel trades, which judges said were vital for the stability of the overall market.
In January, the Supreme Court did not grant Elliott permission to appeal further because it did not raise a “arguable point of law”.
The FCA said that the LME was responsible for multiple failures to deal with severe market stress, including having only junior staff on duty in the early morning of March 8, 2022, when nickel prices rocketed out of control.
The 148-year-old LME, owned by Hong Kong Exchanges and Clearing Ltd., accepted the findings.
“Unfortunately, beyond vindicating the position taken by Elliott, the FCA’s final notice does not address the harm caused,” Elliott said.
(By Pratima Desai; Editing by Eric Onstad and David Evans)
