Pyrenee, Ltd. v. Wocom Commodities Ltd.

Pyrenee, LTD. (Pyrenee) (plaintiff) sued Hong Kong corporations Wocom Commodities and Wocom Limited (Wocom) (defendants) for violating the Commodity Exchange Act (CEA) while serving as Pyrenee’s broker for currency futures trading on various exchanges, including the Chicago Mercantile Exchange (CME). In the brokerage agreement between Pyrenee and Wocom, Wocom acknowledged that any trades made on behalf of Pyrenee in the United States would be subject to both federal and state laws and regulations, and any legal dispute with respect to the agreement could be brought by Pyrenee in any court of competent jurisdiction. Pyrenee’s president, Michael Mak, was a citizen and resident of Hong Kong, but he travelled to the United States for six months in 1996, during which time he continued to communicate with Wocom officials about Pyrenee’s account. During Mak’s time in the United States, Wocom allegedly committed two types of commodity fraud with respect to trades that were or should have been made by Wocom on Pyrenee’s behalf on the CME: bucketing and stealing the ticks, both of which resulted in Wocom fraudulently reaping profits to which it was not entitled. Pyrenee sued Wocom in the Northern District of Illinois, and Wocom moved to dismiss the complaint for lack of subject-matter jurisdiction, lack of personal jurisdiction, and for forum non conveniens.