Bloomberg L.P. v. United States Commodity Futures Trading Commission
949 F. Supp. 2d 91
D.D.C.2013Background
- Bloomberg challenges CFTC regulation 17 C.F.R. § 39.13(g)(2)(ii) on APA grounds, claiming procedural and substantive defects.
- Final Rule imposes minimum liquidation times for derivatives clearing: one day for futures, one day for swaps on some commodity classes, five days for other swaps, with optional longer times for specific products.
- Rule aimed to harmonize margin requirements across DCOs and to prevent a ‘race to the bottom’ among clearing organizations.
- Bloomberg sought injunctive relief arguing imminent irreparable harm in Phase 2 of swap clearing, given potential subscriber migration to rivals.
- Court treated this as a standing challenge, analyzing injury-in-fact, causation, and redressability, and concluded Bloomberg lacks Article III standing.
- Court dismissed case for lack of standing, and briefly addressed irreparable harm only to the extent necessary for the preliminary injunction inquiry.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing requirement satisfied? | Bloomberg contends regulation harms it as a market platform and harms its subscribers. | CFTC argues Bloomberg’s injury arises from third-party actions of DCOs, not directly from regulation; standing is lacking. | Bloomberg lacks Article III standing. |
| Causation and redressability for standing? | Rule will drive traders to migrate to DCMs, causing Bloomberg revenue loss. | Plaintiff relies on speculative third-party behavior; no proven link between rule and third-party actions. | Causation and redressability not established. |
| Irreparable harm, if standing hypothetically met? | Network effects and lost revenue constitute irreparable harm before trial. | Even assuming standing, harm is speculative and not imminent. | Irreparable harm not established; moot because standing fails. |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing requires injury, causation, and redressability)
- Summers v. Earth Island Inst., 555 U.S. 488 (2009) (standing must be injury-in-fact and imminent for prospective relief)
- Renal Physicians Ass’n v. U.S. Dept. of Health & Human Services, 489 F.3d 1263 (D.C. Cir. 2007) (third-party regulation challenges require heightened causation showings)
- National Wrestling Coaches Ass’n v. Dep’t of Educ., 366 F.3d 930 (D.C. Cir. 2004) (causation/redressability hinging on substantial evidence of third-party conduct)