U.S. Supreme Court building
WASHINGTON (Legal Newsline)-The U.S. Supreme Court on Monday denied an appeal by Pacific Investment Management Co., allowing a securities class action lawsuit to proceed against the company.
Newport Beach, Calif.-based PIMCO is accused of manipulating futures markets on the Chicago Board of Trade. The class action lawsuit seeks more than $600 million for the alleged wrongdoing.
PIMCO, the world's largest bond fund manager, is a unit of German insurer Allianz SE. It is alleged to have made $1 billion off the move.
The class action lawsuit was filed against PIMCO in 2005. More than 1,000 investors seek damages, court papers indicate.
The class accuses the California company of cornering the market for contracts on 10-year U.S. Treasury notes during May and June of that year. They alleged that the company increased its percentage stake in futures contracts from 12 percent to 42 percent.
Plaintiffs Richard Hershey and Breakwater Trading LLC claim that PIMCO did so to the advantage of traders who had sold short.
The 7th U.S. Circuit Court of Appeals in Chicago said the case should be allowed to proceed as a class action.
The case is Pacific Investment Management Company v. Hershey, 09-517.
From Legal Newsline: Reach staff reporter Chris Rizo at email@example.com.