William C. Dunn and Delta Consultants, Inc. v. Commodity Futures Trading Commission et al. (519 U.S. 465)
U.S. Supreme Court · decided February 25, 1997 · Supreme Court Database (Spaeth)
- Citation
- 519 U.S. 465 · 117 S. Ct. 913
- Decided
- February 25, 1997
- Term
- October Term 1996
- Vote
- 9–0
- Majority author
- Justice Stevens
- Issue area
- Economic Activity
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Conservative
Opinion excerpt
Justice Stevens delivered the opinion of the Court. The question presented is whether Congress has authorized the Commodity Futures Trading Commission (CFTC or Commission) to regulate “off-exchange” trading in options to buy or sell foreign currency. I The CFTC brought this action in 1994, alleging that, beginning in 1992, petitioners solicited investments in and operated a fraudulent scheme in violation of the Commodity-Exchange Act (CEA), 7 U. S. C. § 1 et seq., and CFTC regulations. App. 10. See 7 U. S. C. §6c(b); 17 CFR §32.9 (1996). The CFTC’s complaint, affidavits, and declarations submitted to the District Court indicate that customers were told their funds would be invested using complex strategies involving options to purchase or sell various foreign currencies. App. 8. Petitioners apparently did in fact engage in many such transactions. Ibid.; 58 F. 3d 50, 51 (CA2 1995). To do so, they contracted directly with international banks and others without making use of any regulated exchange or board of trade. In the parlance of the business, petitioners traded in the “off-exchange” or “over-the-counter” (OTC) market. Ibid. No options were ever sold directly to petitioners' customers. However, their positions were tracked through internal accounts, and investors were provided weekly reports showing the putative status of their holdings. Petitioners and their customers…
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