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.
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