The battle for the over-the-counter (OTC) market entered the courtroom on Wednesday as the New York Mercantile Exchange (Nymex) filed a lawsuit against IntercontinentalExchange (ICE) for copyright violations in its use of Nymex natural gas and crude oil futures settlement prices.

ICE is an electronic trading platform based in Atlanta that offers hundreds of commodity products including precious metals, petroleum, natural gas and power. Its main domestic rival is Nymex, which began offering its own suite of OTC commodities for trading earlier this year. ICE also owns the London-based International Petroleum Exchange.

In its lawsuit, Nymex states that since April ICE has been “copying, reproducing, distributing and preparing” derivatives based on Nymex settlement prices for Henry Hub natural gas futures and WTI [West Texas Intermediate] Cushing light sweet crude oil. Nymex determines its commodity futures and options settlement prices based on trading conducted on the exchange and over its own electronic trading platform, Nymex Access, which offers many of the same products that are offered on ICE.”

According to the lawsuit filed in Manhattan federal court, Nymex claims its settlement prices are protected by copyright law. It alleges that ICE has been copying its settlement prices “in order to clear and financially settle trades of derivative contracts for those commodities on” its own exchange, which is in “competition with plaintiff.”

ICE spokeswoman Kelly Loeffler said she hadn’t seen the lawsuit and couldn’t comment. “It probably has to do with the way we clear our contracts using the settlement prices,” she said, adding that the only Nymex settlement prices that are used by ICE are for oil and natural gas futures.

Nymex believes it will lose “substantial revenues and profits” as a result of the alleged copying. The lawsuit seeks a court order barring ICE from copying its settlement prices and making it pay Nymex an unspecified amount in damages.

ICE and Nymex have been clear rivals for several years but started seriously butting heads in the over-the-counter market this summer. Earlier this month, ICE said about one million natural gas contracts have been cleared through its system since March with a notional value of about $10 billion. Meanwhile, Nymex, which got off to a slower start, said that $1.5 billion in OTC instruments (for natural gas, power and other commodities) have been cleared since clearing services began at the end of May. Both exchanges are attempting to fill the void in the OTC market left by EnronOnline, which became ubswenergy.com after UBS Warburg bought the severely weakened operation last year.

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