IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

In re Deutsche Bank Spoofing Litigation

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Case No. 20-cv-3638

Judge Joan B. Gottschall

ORDER

The court has before it supplemental briefing on whether plaintiffs’ consolidated 

complaint, ECF No. 40, adequately alleges standing under Article III of the Constitution and 

whether plaintiffs should be permitted to take jurisdictional discovery to determine whether 

standing exists. For the following reasons, the court finds that the standing and merits issues are 

intertwined and authorizes a limited period of jurisdictional discovery.

Background

Plaintiffs’ claims arise under the Commodity Exchange Act (“CEA”), 7 U.S.C. § 1 et seq. 

This court’s order dated September 20, 2021 (“briefing order”), described plaintiffs’ complaint 

and plaintiffs’ allegations in detail. See Briefing Order at 2–7, ECF No. 49. By way of a short 

summary, plaintiffs regularly trade Treasury or Eurodollar futures (“EDF”) contracts, according 

to their complaint. They have sued Deutsche Bank AG (“DBAG”) and Deutsche Bank Securities 

Inc. (“DBSI”) (collectively, “defendants”), based on allegations that defendants “spoofed the 

markets for Treasury and Eurodollar Futures throughout the Class Period,” that is, during 

calendar year 2013. Compl. ¶¶ 18, 93. As a result, plaintiffs allege that they were “deprived . . .

of the ability to transact in a lawful market that was free of manipulation and caused Plaintiffs 

and the Class to pay more to purchase, or receive less to sell, Treasury and Eurodollar Futures.” 

Id. ¶ 18. 

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“Eurodollars are U.S. dollars deposited in commercial banks outside the United States.” 

Compl. ¶ 42. As defined by plaintiffs, spoofing “entails: (a) submitting or cancelling bids or 

offers to overload the quotations system of a registered entity; (b) submitting or cancelling bids 

or offers to delay another person’s execution of trades; (c) submitting or cancelling multiple bids 

or offers to create an appearance of false market depth; or (d) submitting or canceling bids or 

offers with the intent to create artificial price movements.” Compl. ¶ 44; see also Briefing Order 

at 3–5. 

Plaintiffs allege that, due to the nature of spoofing and the lack of publicly available 

information, plaintiffs do not know with certainty the dates of defendants’ alleged spoofing nor 

the identities of the traders involved. Compl. ¶ 6. Plaintiffs’ claims stem in part from a 

Commodities Futures Trading Commission (“CFTC”) order, Deutsche Bank Sec. Inc., CFTC 

No. 20-17, 2020 WL 3444513 (June 18, 2020), in this record at ECF No. 42-1, disclosing the 

Commission’s acceptance of an offer to settle, without an admission of liability, allegations of 

spoofing in the Treasury and Eurodollar futures markets in January–December 2013. See

Briefing Order at 5–6. The CFTC order includes no specific date(s) of alleged spoofing and does 

not specify how frequently spoofing allegedly occurred. See id. 

According to the complaint, plaintiffs “will be able to ascertain the full extent of 

Deutsche Bank’s spoofing misconduct in Treasury and Eurodollar futures only after they are 

given access to Deutsche Bank’s trading data concerning these instruments.” Compl. ¶ 92. 

Defendants moved to dismiss the complaint on the merits for failure to state a claim upon which 

relief can be granted. See Fed. R. Civ. P. 12(b)(6). This court ordered the parties to brief 

Article III standing, stating as follows:

Defendants raise important and thorny legal questions concerning the scope of the 

private right of action created by the CEA. . . . Defendants also argue, inter alia, 

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that the complaint fails to plead that any plaintiff suffered actual damages: 

“Plaintiffs fail to plausibly allege that they transacted in even one Treasury Future 

or EDF at an affected price or even that an affected price actually existed. Plaintiffs 

do not identify specific transactions, the direction of manipulation, or whether 

[they] paid more or accepted less. . . . Plaintiffs fail to plead facts regarding any 

specific date on which any Plaintiff traded, which EDF [Eurodollar futures] or 

Treasury Future was traded, or whether that transaction was sold for less or bought 

for more money than it would have been otherwise.” Defs.’ Mem. Supp. Mot. to 

Dismiss 11, ECF No. 42 (internal quotations and citations omitted).

Plaintiffs respond that it is reasonable to infer that defendants’ alleged manipulation 

adversely affected at least one of their Treasury or Eurodollar trades because they 

regularly traded in Treasury and Eurodollar futures in 2013, and the CFTC Order 

settled allegations that DBSI traders engaged in spoofing on various, unspecified 

occasions the same year. See Pls.’ Resp. Mem. 6–7, ECF No. 44. 

Briefing Order at 7–8.

Relying on cases cited by the parties, this court determined, “Although the parties have 

briefed the actual damages question as a merits issue, their arguments also implicate the injury in 

fact and traceability requirements of Article III standing.” Id. at 8–9 (citing, among other 

authorities, Dennis v. JPMorgan Chase & Co., 343 F. Supp. 3d 122, 154–55 (S.D.N.Y. 2018)). 

Because standing had not been briefed and “the case law on standing to bring a private 

manipulation claim under the CEA is complex and often highly fact-sensitive,” id. at 9 (citations

omitted), this court directed the parties to brief the following questions: “(1) does the complaint 

adequately allege the elements of Article III standing? And (2) if not, is limited jurisdictional 

discovery appropriate?” Id. at 9–10.

Analysis

The requirement that a litigant invoking the jurisdiction of a federal court establish 

standing to sue stems from Article III of the Constitution, which limits the jurisdiction of the 

federal courts to “cases” and “controversies.” Fed. Election Comm'n v. Cruz, 142 S. Ct. 1638, 

1646 (2022); Spokeo, Inc. v. Robins, 578 U.S. 330, 337 (2016). “The requisite elements of 

Article III standing are well established: A plaintiff must show (1) an injury in fact, (2) fairly 

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traceable to the challenged conduct of the defendant, (3) that is likely to be redressed by the 

requested relief.” Cruz, 142 S. Ct. at 1446 (citing Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–

61 (1992)). Each element of standing “must be supported in the same way as any other matter 

on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence 

required at the successive stages of the litigation.” Lujan, 504 U.S. at 561 (citations omitted).

At the pleading stage, standing challenges generally fall into two categories–facial and 

factual attacks. Prairie Rivers Network v. Dynegy Midwest Generation, LLC, 2 F.4th 1002, 1007 

(7th Cir. 2021) (citing Bazile v. Fin. Sys. of Green Bay, Inc., 983 F.3d 274, 279 (7th Cir. 2020)); 

see also Apex Digit., Inc. v. Sears, Roebuck & Co., 572 F.3d 440, 444–45 (7th Cir. 2009). The 

parties disagree about which type of challenge has been raised here. “A facial attack ‘tests 

whether the [complaint’s] allegations, taken as true, support an inference that the elements of 

standing exist,’ and a factual attack ‘tests the existence of jurisdictional facts underlying the 

[complaint’s] allegations.’ ” Prairie Rivers, 2 F.4th at 1007 (quoting Bazile, 983 F.3d at 279). A 

factual attack “lies where ‘the complaint is formally sufficient but the contention is that there is 

in fact no subject matter jurisdiction,’ ” as where a party points to facts outside the complaint to 

show that there is no jurisdiction or puts at issue the complaint’s well-pleaded facts supporting 

jurisdiction. See Apex. Digit., 572 F.3d at 443–44. 

Defendants characterize their standing challenge as a facial attack. Defs.’ Suppl. 

Resp. 8–9, ECF No. 51. Plaintiffs contend that in reality defendants are mounting a factual 

attack on allegations in the complaint, such as their assertions that their trades overlapped with 

defendants’ alleged spoofing activity. Pls.’ Suppl. Reply 6–7, ECF No. 52.

Regardless of whether defendants are mounting a facial or factual attack on standing, the 

attack raises causation questions that are intertwined with the merits of plaintiffs’ CEA claims. 

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Indeed, defendants originally briefed their causation arguments as merits questions. See Defs.’ 

Mem. Supp. Mot. to Dismiss 5–14. As pleaded in the complaint and made apparent in the 

supplemental briefing, the key factual questions concern the number, frequency, and extent of 

trades in which alleged spoofing occurred; this information is unavailable to plaintiffs without 

discovery. See, e.g., Compl. ¶ 92. Those factual questions inform the analysis of Article III’s 

injury in fact and traceability requirements, as well as merits questions concerning the CEA’s 

causation element.

This case therefore falls into the “class of those [cases] where standing and the merits are 

inextricably intertwined.” City of Revere v. Mass. Gen. Hosp., 463 U.S. 239, 243 n.5 (1983) 

(quoting Holtzman v. Schlesinger, 414 U.S. 1316, 1319 (1973)); see also Walters v. Edgar, 

163 F.3d 430, 434–35 (7th Cir. 1998); Price v. Pierce, 823 F.2d 1114, 1119 (7th Cir. 1987); 

Crawford v. United States, 796 F.2d 924, 929 (7th Cir. 1986). Where standing and merits issues 

are intertwined, courts may, in their discretion, postpone resolution of the standing issue until the 

factual record has been more fully developed. See, e.g., OrthoPediatrics Corp. v. Wishbone 

Med., Inc., 2021 WL 3887243, at *5 (N.D. Ind. Aug. 31, 2021); Markle v. Drummond Advisors, 

LLC, 2020 WL 777272, at *3–4 (N.D. Ill. Feb. 18, 2020); Gruen Mktg. Corp. v. Benrus Watch 

Co., 955 F. Supp. 979, 982 (N.D. Ill. 1997). But postponing standing questions comes with a 

risk of driving up unnecessarily the costs of litigation and discovery to the parties and the court, 

for if the court later determines that no named plaintiff has standing, “the federal court lacks 

subject matter jurisdiction and the suit must be dismissed” without reaching the merits. Int’l 

Union of Operating Eng’rs, Local 139 v. Daley, 983 F.3d 287, 294 (7th Cir. 2020) (quoting 

Taylor v. McCament, 875 F.3d, 853 (7th Cir. 2017)). As this court’s briefing order explained, 

here there is a significant danger of deciding “thorny” merits questions at the motion to dismiss 

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stage, even though standing may ultimately be found to be lacking following appropriate 

discovery. Briefing Order at 7–8. Because of these concerns, the court directed the parties to 

brief limited jurisdictional discovery. See id. at 10. 

Federal courts possess discretion to authorize discovery relevant to contested 

jurisdictional facts. See Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 

694, 708–09 (1982); Philos Techs., Inc. v. Philos & D, Inc., 802 F.3d 905, 912 (7th Cir. 2015); 

Cent. States, Se. and Sw. Areas Pension Fund v. Phencorp Reinsurance Co., Inc., 440 F.3d 870, 

878 (7th Cir. 2006); Perry v. Pogemiller, 16 F.3d 138, 139–40 (7th Cir. 1993). This includes the 

power to permit jurisdictional discovery on Article III standing. E.g., Daly v. Eagleson, 

2021 WL 4439428, at *5 (N.D. Ill. Sept. 27, 2021); Access 4 All, Inc. v. Chi. Grande, Inc., 

2007 WL 1438167, at *10 (N.D. Ill. May 10, 2007); K.G. ex rel. P.G. v. Hamos, 2014 WL 

274130, at *5 (C.D. Ill. Jan. 24, 2014); see also Crabtree v. Experian Info. Sols., Inc., 948 F.3d 

872, 876 (7th Cir. 2020). 

Plaintiffs proposed conducting limited jurisdictional discovery as follows: 

Here, pre-existing, non-privileged documents furnished to or by the CFTC (and 

those in any related CME [Chicago Mercantile Exchange] and/or CBOT [Chicago 

Board of Trade] investigations) would be sought in discovery. To the extent 

Defendants’ order and trade history is not in those files, the full record of 

Defendants’ orders, trades and cancelations in CBOT Treasury and CME 

Eurodollar futures during 2013 also would be sought.

Pls.’ Suppl. Br. 12–13, ECF No. 50. 

Defendants do not argue that the proposed jurisdictional discovery would be unduly 

burdensome except insofar as they maintain that discovery is not appropriate if the complaint 

fails to allege the elements of standing. Defs.’ Suppl. Resp. 8–11. That argument fails to 

persuade in view of the court’s conclusion that the standing and merits issues defendants have 

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raised are intertwined, and as stated above, in such circumstances, the court has discretion to 

allow some jurisdictional discovery. 

Because plaintiffs’ proposal for discovery appears to be manageable and considerably 

less burdensome than full merits discovery (yet relevant to the merits if standing is present), the 

court authorizes plaintiffs to conduct limited discovery consistent with the proposal in their 

supplemental memorandum. ECF No. 50 at 12–13. As plaintiffs propose, the parties are 

directed to confer and submit a proposed limited discovery plan within 14 days (on or before 

August 3, 2022).

Dated: July 20, 2022 /s/

Joan B. Gottschall

United States District Judge 

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