Two London-based companies and certain employees involved in trading West Texas Intermediate crude oil (WTI) and oil futures have agreed to pay $16.5 million to settle a lawsuit accusing the defendants of artificially manipulating the price of oil in order to reap huge profits.

Parnon Energy Inc., Arcadia Petroleum Ltd. and other defendants will pay the $16.5 million into a fund to compensate oil futures traders and others who lost money as a result of the scheme, although the companies continue to deny the plaintiffs' claims.

"We believe that this is a very good outcome for those businesses and individuals who were harmed by this market manipulation," says Warren Burns, co-lead counsel for the plaintiffs and name partner in Dallas' Burns Charest. "This was an extremely hard fought case. Settling now ensures that class members will receive compensation once the court approves the settlement." Attorneys Christopher Lovell and Christopher McGrath of New York's Lovell Stewart Halebian Jacobson LLP also represented the plaintiffs.

The case, which was filed in 2011, is In re: Crude Oil Commodity Futures Litigation, No. 11-cv-3600, in the U.S. District Court for the Southern District of New York.

In early 2008, according to the plaintiffs, the defendant companies held futures positions in WTI when they bought large amounts of the actual crude to artificially drive prices higher. After taking profits, the companies allegedly sold all of their physical WTI, driving down prices so they could profit on the difference in the spread once again, through another market position.

Plaintiffs claimed that the scheme violated both the Sherman Antitrust Act and the Commodity Exchange Act. In 2014, a parallel investigation by the U.S. Commodity Futures Trading Commission ended when the defendant companies agreed to pay a $13 million settlement.

The money from the recent settlement will be placed in a fund, and details for potential claimants will be available on a website that the fund plans to have in operation soon.

Burns Charest is a Dallas-based trial law firm with a national practice representing consumers and businesses in large complex class actions and antitrust cases. The firm is composed of trial lawyers who handle high stakes cases and other complex litigation on behalf of individuals and businesses.

Source: www.youroilandgasnews.com

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