U.S. Court Denies Application for Temporary Injunction to Block Trading of Individual Stock Perpetual Contracts

on November 5, a judge at the U.S. District Court for the Southern District of New York denied a temporary restraining order filed by the Capital Markets Alliance Association, which sought to suspend the Commodity Futures Trading Commission (CFTC)'s approval of individual stock perpetual derivatives.

The court found that the plaintiffs failed to demonstrate that failing to grant emergency relief would result in imminent irreparable harm to its members. However, the judge noted that the plaintiffs' claim that the CFTC lacks authority to approve the relevant products as security futures could potentially prevail, as the contracts appear to meet the definition of swaps regulated by the U.S. Securities and Exchange Commission.

Under the ruling, the CFTC must respond to the preliminary injunction motion by November 6, and the plaintiffs must reply by November 10; the schedule may be adjusted by the judge handling the case.