Millennium Management has accused Jane Street Group of engaging in “gamesmanship” by failing to fully disclose the proprietary trading strategy allegedly stolen by two former traders who joined Izzy Englander’s hedge fund group.
In a letter to US District Judge Paul Engelmayer on Friday, lawyer Andrew Levander, representing Millennium and the ex-Jane Street traders Douglas Schadewald and Daniel Spottiswood, expressed frustration over Jane Street’s reluctance to adequately identify the disputed strategy in court filings.
Levander criticized Jane Street’s approach, stating that the lack of disclosure contradicts the firm’s commitment to providing fair notice of its purported trade secrets. He urged the judge to order Jane Street to submit a disclosure to the court and defense by April 30.
Speculation has surrounded the undisclosed strategy since Jane Street filed its lawsuit on April 12. Although heavily redacted in the complaint, the strategy was described as “immensely valuable.” During an April 19 hearing, it was inadvertently revealed that the strategy pertains to options trading in India and generated $1 billion in profit for Jane Street.
In response, Deborah Brown, a lawyer for Jane Street, filed a court document on Friday opposing Millennium’s request for a disclosure order, deeming it unreasonable and prejudicial.
Jane Street alleges that it knew Schadewald and Spottiswood were using its strategy at Millennium due to a 50% drop in profits, which the firm attributes to the entrance of a competitor employing the same strategy.
Levander criticized Jane Street’s request for trading data from Millennium before specifying its trade secrets, labeling it as asymmetrical and potentially prejudicial. Judge Engelmayer denied Jane Street’s request for a temporary restraining order against Millennium, Schadewald, and Spottiswood but set an expedited case schedule and a trial date for July.
Jane Street subsequently filed a revised lawsuit on Friday, dropping its request for an order barring the defendants from using its strategy. Brown argued earlier this week that a July trial was unrealistic given the volume of evidence needed, suggesting a trial date for next year instead.
Levander contested this delay, arguing that prolonging the case unfairly impacts the defendants’ reputations and livelihoods. Millennium, Schadewald, and Spottiswood deny using Jane Street’s trade secrets, with defense lawyers suggesting at the April 19 hearing that the strategy in question may not be as secretive as claimed.
The case, Jane Street Group LLC v Millennium Management LLC, is ongoing in the US District Court, Southern District of New York (Manhattan).
