Procedures for Filing a Liability Claim

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1 Attached is an overview of the procedures and a form for filing a CME Globex Liability Claim or a Trade Adjustment/Cancellation Claim ( Claim Form ), as well as links to relevant CME, CBOT, NYMEX and COMEX (each an Exchange or collectively the Exchanges ) rules. For information on the potential liability of an Exchange or a trade counterparty related to limitation of liability, trade cancellations and price adjustments, arbitration and claims against an Exchange involving trading systems or services, please refer to Exchange Rules 578, 579, 588, 600 and 621 (links below). For more information on the non-reviewable ranges, please refer to CMEGroup.com and Exchange Rule 588.H. If you have any questions regarding these rules, liability policy or processes related to filing liability or trade adjustment/cancellation claims, please contact Rachel Johnson, Staff Attorney, Legal Department, at Procedures for Filing a Liability Claim Exchange Rule 578 (LIMITATION OF LIABILITY, NO WARRANTIES) provides that each Exchange may accept liability for direct, out-of-pocket losses incurred by a customer directly caused by the negligence of the CME Global Command Center ( GCC ) or other Exchange staff, order status errors provided by the GCC, subject to certain limitations. All claims for damages under the liability rules will be examined by CME Group staff. To file a claim for damages, an individual or firm ( Claimant ) must complete a Claim Form, attached to this document. Claims f o r l osses under this section must be filed with the Legal Department within ten (10) business days after a Claimant knows or should have known that a loss was incurred. Failure to file a Claim Form correctly and in a timely manner will result in the Claim s denial. On the Claim Form, a Claimant must clearly, and in detail, indicate the facts upon which the claim is based. Additionally, Claimants must provide evidence of damages, including, among other things, profit and loss statements and any other documents deemed relevant. Procedures for filing a Trade Adjustment/Cancellation Claim Exchange Rule 588 (TRADE CANCELLATIONS AND PRICE ADJUSTMENTS) provides that a party entering an order that results in a price adjustment or trade cancellations shall be responsible for demonstrated claims of realized, or out-of-pocket losses, subject to certain limitations. All claims for losses resulting from price adjustments or cancellations will be examined by CME Group staff. To file a claim for damages, an individual or firm ( Claimant ) must complete a Claim Form, attached to this document. Claims for losses under this section must be filed with the Legal Department within five (5) business days of the event giving rise to the claim. Failure to file a Claim Form correctly and in a timely manner will result in the Claim s denial. On the Claim Form, a Claimant must clearly, and in detail, indicate the facts upon which the claim is based. Additionally, Claimants must provide evidence of loss, including, among 1 P a g e

2 other things, profit and loss statements and any other documents deemed relevant. Review of Claims On or about the fifteenth day of each month, the liability committee will review the claims that have been filed in the previous month (e.g., on June 15, claims for the month of May will be reviewed). Claimants will generally be informed of the staff committee decision within twenty (20) business days of filing the claim. Should the committee determine a payment will be made, the Claimant must sign a release waiving any and all claims or potential claims against the Exchange before any payment will be made. In the event a claim is denied, a claimant has a limited right of appeal as set out in the Exchange Rules. If you have any questions about this procedure, please contact Rachel Johnson, Staff Attorney, Legal Department, at P a g e

3 CME GLOBEX Liability and Trade Adjustment/Cancellation Claim Form The purpose of the attached Claim Form is to provide guidance for Claimants that wish to file a claim against CME, CBOT, NYMEX or COMEX under each Exchange s Limitation of Liability Rules OR to file a trade adjustment/cancellation claim under each Exchange s Rules. The claimant must check one (1) box below indicating whether its claim concerns Exchange liability or a trade adjustment/cancellation. Claims will be reviewed by a CME Group staff committee on or about the 15th of each month for claims that were received the previous month. Please be as complete as possible when completing the Claim Form and attach additional sheets as necessary. Completed Claim Forms should be forwarded, along with all supporting documentation, to cmegroupclaims@cmegroup.com or the following address: CME Group Inc. Legal Department 20 S. Wacker Drive, 5 South Tower Chicago, Illinois ATTN: Rachel Johnson CME GLOBEX Liability and Trade Adjustment/Cancellation Claim Form CHECK ONLY ONE: Liability Claim Trade Adjustment/Cancellation Claimant Name: Clearing Member Claim Filing Date Claimant Address: City: State: Zip Code: Country (Only if not USA): Phone (include area code): Fax: Address: Date of incident: Time of incident: Contract Involved: 2 P a g e

4 When did you discover that a problem existed? Did you contact the Global Command Center? Yes No If yes, to whom did you speak? What was the result? Did you contact any other Exchange Departments? Yes No If yes, which Department(s) and to whom did you speak? 3 P a g e

5 What was the result? Please describe in detail the events giving rise to your claim (attach additional sheets if necessary): What is the amount of your claim? 4 P a g e

6 Please describe in detail how you arrived at the claim amount set forth above: Please attach any documents that support your claim. Per Exchange Rules, this claim must be filed within the timeframe noted above for each respective claim type or it will be denied. 5 P a g e

7 Rulebooks: Reference Chapter 5: Rules 578, 579, 588 of the relevant exchange Reference Chapter 6: Rules 600, 621 of the relevant exchange CME Rulebook Chapter 5: Trading Qualifications and Practices Chapter 6: Arbitration CBOT Rulebook Chapter 5: Trading Qualifications and Practices: Chapter 6: Arbitration: NYMEX/COMEX Rulebook Chapter 5: Trading Qualifications and Practices: Chapter 6: Arbitration: For support information and contact numbers for the CME Global Command Center, Click Here 6 P a g e