UBS Probably Not Going To Get Close To What It Wants From Nasdaq For Facebook F*ck Up

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Based on a judge's ruling today.

A divided U.S. appeals court rejected UBS AG's bid to force Nasdaq OMX Group Inc to arbitrate a dispute over the exchange operator's alleged "catastrophic mismanagement" of Facebook Inc's $16 billion initial public offering. The 2nd U.S. Circuit Court of Appeals in New York on Friday said UBS' agreement with Nasdaq to help make a market for Facebook shares did not entitle the Swiss bank to arbitration, in its effort to recoup more than $350 million of losses...Facebook's first day of trading on May 18, 2012 was plagued by technology problems, resulting in a delayed opening and tens of thousands of trade and cancellation orders being stuck in Nasdaq's system for more than two hours. While market makers lost an estimated $500 million on Facebook's IPO, federal regulators last year approved a plan for Nasdaq to repay only about $41.6 million. Friday's decision may therefore make it more difficult for UBS to recoup anything close to its estimated losses.

UBS cannot arbitrate vs Nasdaq over Facebook IPO: court [Reuters]

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Nasdaq Officials Would Just Like To Point Out That Anyone Who Lost Money As A Result Of The Exchange's Incompetence Have Little To No Legal Recourse

Oh you can try a lawsuit but, historically speaking, it won't do shit. Nasdaq is sending a message to firms weighing lawsuits related to trading losses in Facebook's initial public offering: winning won't be easy. The exchange operator believes it is protected by its contracts with members and by its unusual legal status, which is rooted in its dual role as a regulatory body as well as a business that makes money running markets. Exchange officials in recent weeks have pointed out to analysts that Nasdaq has never been successfully sued over a trading error. "When you look at member agreements that people sign, it's quite explicit that they're bound by that accommodation policy," Robert Greifeld, Nasdaq's chief executive, said last week at a Sandler O'Neill + Partners conference, referring to legal agreements capping the exchange's payouts linked to system problems...Banks and brokers have estimated they lost hundreds of millions of dollars due to technical problems during Facebook's May 18 debut. The glitches forced Nasdaq to delay Facebook's opening, and left trades involving millions of shares unconfirmed for hours. Amid the chaos, traders were forced to guess their positions and place additional orders based on those estimates. When Nasdaq delivered the results of the trading Friday afternoon, many firms were caught off guard and scrambled to reposition. According to Greifeld, the last guy who tried to get his money back "trades on the pink sheets now" but take your best shot. Nasdaq Claims Strong Defense [WSJ] Related: UBS Not Sweating The Small Stuff