The court-directed disclosure of oil-trading records and other documents from a six-year U.S. probe will be delayed at least six days while an appeals court considers speeding up its review of the order.
The U.S. Court of Appeals in New York today blocked the disclosure until at least Nov. 26, when it will consider arguments by oil traders including Morgan Stanley and Royal Dutch Shell Plc in favor of an expedited appeal and for an order delaying disclosure of the records until the appeals court rules.
The oil traders are seeking to block the release of millions of records gathered by the Commodity Futures Trading Commission as part of a probe begun in December 2007.
The files include e-mails, depositions, trading records and audio files. U.S. District Judge William H. Pauley on Oct. 25 held that he would allow the material to be provided to lawyers suing over alleged oil market manipulation.
The CFTC on May 24, 2011, accused Parnon Energy Inc., which is controlled by billionaire John Fredriksen, of manipulating the prices of West Texas Intermediate crude. Two days later, a private plaintiff sued Parnon, seeking to represent a class of everyone who traded in WTI derivative contracts from Dec. 1, 2007, until at least May 31, 2008.
The Oct. 26 ruling restricts the most sensitive documents from being used outside the litigation. Pauley hasn’t yet ruled whether he’ll let the case proceed as a class action.
The case is In Re Crude Oil Commodity Futures Litigation, 11-cv-03600. The CFTC case is U.S. Commodity Futures Trading Commission v. Parnon Energy Inc., 11-cv-3543, U.S. District Court, Southern District of New York (Manhattan). The appeal is U.S. Commodity Futures Trading Commission v. Parnon Energy Inc., 13-04206, Second U.S. Circuit Court of Appeals (Manhattan).