Court vacates PHLX case

Philadelphia Stock Exchange (PHLX) has been cleared of damage payments of $1m to a floor trader who sued in part the exchange after a brawl with a fellow trader in 2002.

The Superior Court of Pennsylvania vacated the award from a case stemming from an altercation between William Dooner and Ralph DiDonato five years ago.

A Philadelphia Court of Common Pleas jury previously awarded the plaintiff nearly $2m for injuries allegedly sustained during the fight and held PHLX responsible for 50% of the total damages.

In vacating that award, the Superior Court held that the Securities Exchange Act preempts a floor trader's negligence causes of action against a national securities exchange where those causes of action implicate the exchange's statutory authority to govern itself, a statement said.

Because of this federal preemption, the Exchange is entitled to judgment as a matter of law, stating “floor traders who abuse other floor traders are subject to civil liability and/or criminal liability in an appropriate case. Nothing in this opinion precludes an injured floor trader bringing a state tort action against a fellow trader, but not against the exchange.”