Salomon Forex, Inc. v. Tauber
United States Court of Appeals for the Fourth Circuit
8 F.3d 966 (1993)

- Written by Solveig Singleton, JD
Facts
Dr. Lazlo Tauber (defendant), a sophisticated individual investor, negotiated thousands of transactions involving the sales of foreign currency futures with Salomon Forex, Inc. (Salomon) (plaintiff). Tauber bought and sold foreign currency with different firms, seeking to buy low and sell high. Actual currency was delivered only in four transactions. When Tauber’s holdings lost value, Salomon asked Tauber to cover the loss. Tauber did not do so. The futures contracts ultimately came due. Salomon sued Tauber for $26 million in debt not covered by the value of his collateral. Tauber argued that he was not responsible for the debt because his contracts with Salomon violated the Commodities Exchange Act (CEA). Salomon brought suit. The district court ruled in Salomon’s favor, and Tauber appealed.
Rule of Law
Issue
Holding and Reasoning (Niemeyer, J.)
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