Breaking: Court Says IS Prime Claims against ThinkMarkets Have No Legal Basis

IS Prime Risk Services Inc acquired Think Liquidity in 2017.

Losses of $15 million were alleged as a result of contract breaches.

According to court documents, the claimant, IS Prime alleges that from about September 18, 2018, in breach of a Liquidity Addendum signed between the companies after the acquisition of Think Liquidity by IS Risk Analytics, the defendants used the services of another broker or brokers for business they were obliged to give exclusively to the claimant until January 17, 2020.

The claimant says it suffered losses of $15 million approximately as a result, and it claims damages, an account, and inquiry as to damages.

In 2017, the risk management unit of IS Prime, IS Prime Risk Services Inc, has acquired the assets of one of the most popular risk management service providers for brokers at the time, Think Liquidity. Both parties signed an exclusivity agreement dated January 19, 2017, entitled ‘Liquidity Addendum’ as part of the deal for IS Prime to provide liquidity to ThinkMarkets via its FCA-regulated matched principle license.

ThinkMarkets Disputing an Amendment to the Deal

IS Prime stated that it was transferring its index swap business to a Hong Kong affiliate with effect from December 18, 2017, and thereafter ceased itself to trade index swaps. The defendant, ThinkMarkets hence didn‘t agree to the change, and claimed it’s discharged from any continuing obligation under the Liquidity Addendum concerning that class of product.

As a result, ThinkMarkets had no open positions to close and never instructed an index swap transaction with IS Prime via its IS Prime Hong Kong subsidiary. IS Prime claimed that existing terms of trade between IS Prime and ThinkMarkets continued in full force and effect, but the latter disagreed.

“I have accordingly come to the conclusion that the claim by IS Prime, insofar as it relates to the trading of index swaps after 18 December 2017, has no real prospect of succeeding. IS Prime has no real prospect of overcoming the defense pleaded in paragraph 28(3) of the Amended Reply to Defence to Counterclaim. There is no other compelling reason why the matter should be disposed of at trial. I will therefore give summary judgment under CPR Part 24 in favour of Think on that issue,” the court determined.