A group of hedge funds, including AQR Capital Management, DRW Commodities LLC, and Pala Investments Ltd, have withdrawn their compensation claims against the London Metal Exchange (LME) over its handling of the 2022 nickel crisis, according to a report by Bloomberg.
The move follows the rejection of similar claims in separate proceedings by UK courts.
The hedge funds had filed lawsuits demanding over $100m in damages after the LME cancelled $12bn in trades after a short squeeze caused prices of the metal to surge. Their legal claims had been paused, pending the outcome of Elliott Investment Management’s high-profile lawsuit against the LME. Earlier this year, the UK Supreme Court refused Elliott’s request to appeal a decision against it, effectively concluding that case.
With the Supreme Court’s decision, the other funds’ cases have now been discontinued, according to court filings and sources familiar with the matter. Representatives for the funds did not respond to requests for comment, and a spokesperson for the LME also declined to comment.
The LME defended its actions during the crisis, stating that the decision to cancel trades in March 2022 was necessary to protect the metals industry from a “death spiral” that could have led to widespread bankruptcies. While the UK courts have ruled that the LME acted legally, the Financial Conduct Authority (FCA) fined the exchange £9.2m ($11.9m) in March 2024 for having inadequate systems and controls during the crisis.
In its annual report, the LME noted that the Supreme Court’s decision to deny the appeal “effectively brings an end” to Elliott’s case. The report, filed in February 2025, also revealed that Elliott and Jane Street had made interim payments totaling over £4m in 2024 to cover the LME’s legal costs.
