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Heres what the CME has to say...
Letter from Craig S. Donohue, Senior Vice President and General Counsel, CME:
May 17, 1999
To All Members & CME Staff:
On Friday, Victor Niederhoffer and four funds managed by him brought suit claiming the Exchange and persons unknown were
responsible for trading losses suffered as a result of the market crash on October 27, 1997. Mr. Niederhoffer asserts that the
settlement prices for certain index options were incorrectly established and that the Exchange is liable for damages in excess of
$100,000,000. Another trading company, Manchester Trading, LLC, controlled by Mr. Niederhoffer, claims to have been
injured in the amount of $5,000,000 by an option settlement price on August 13, 1998. Mr. Niederhoffer also purports to sue
to recover losses that his default caused Refco, Inc., a clearing member of the CME.
We have been aware of Mr. Niederhoffer's claims for more than a year. His claims were thoroughly investigated. Mr.
Niederhoffer was given documentation demonstrating that he had based his claim on incorrect information. As recently as
March 31 this year, we made a written offer to permit him to interview our staff and review our records in order to demonstrate
that the Exchange was absolutely blameless. Mr. Niederhoffer rejected our offer, which, if accepted, would surely have
prevented this baseless litigation. Instead, he chose to rely on the incorrect information and a raft of unsupportable allegations.
This matter will be tried in the United States District Court for the Northern District of Illinois. It has been assigned to Judge
Ann C. Williams. While this case is pending, we will follow our normal practice and limit our public comments and reserve our
responses for the courtroom. The Exchange is confident that it will prevail in this matter.
(signature of Craig S. Donohue)
On Tue, 18 May 1999 13:40:41 JER3CUBE wrote:
>In a message dated 5/18/99 8:31:11 AM Eastern Daylight Time,
>gmkramer@xxxxxxxxxxxx writes:
>
><< His track record apparently had been great before this but he blew up on
>Oct. 27 when the Dow sunk by 554 points.
>
> Give me a break. Everything I read or hear is that a good trader needs to
>be accountable for his/her actions. Apparently its not the case here.
> >>
>
>GEORGE SOROS terminated their relationship when he found himself
>down 50%.....Good you say?.....Gambler, maybe....trader???
>GB
>
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