By Jonathan Stempel
Nov 13 (Reuters) - The Chicago Board Options Exchange has
sued International Securities Exchange LLC for at least $525
million, accusing its rival of infringing three patents related
to an automated options trading system.
In a complaint filed on Monday in the U.S. District Court in
Chicago, CBOE said the patents were issued in 2008, 2011 and
2012, and cover systems to monitor quote risk and automatically
adjust quotes when risk exposure gets too high.
The Chicago-based unit of CBOE Holdings Inc said these
methods are "crucial to market maker participation" and that
ISE, a unit of Deutsche Boerse AG, has deprived it of profit and
royalties by infringing its patents.
CBOE is seeking a minimum of $525 million to cover what it
described as lost profit and reasonable royalties. It is also
seeking triple damages if any infringement is deemed willful.
Molly McGregor, a spokeswoman for ISE, declined to comment.
Both exchanges have fought each other for years over a range
of intellectual property issues.
CBOE filed its complaint six months after a U.S. appeals
court in Washington, D.C. revived ISE's own patent infringement
lawsuit challenging CBOE's hybrid trading system, which combines
floor-based "open outcry" trading and electronic trading. ISE is
an all-electronic platform.
Less than three weeks after the May 7 federal appeals court
ruling, an Illinois state appeals court upheld a ban on ISE from
listing Standard & Poor's 500 index options, one of CBOE's most
profitable products, and Dow Jones Industrial Average options.
The case is Chicago Board Options Exchange Inc v.
International Securities Exchange LLC, U.S. District Court,
Northern District of Illinois, No. 12-09085.
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