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Trading

Investor group challenges NYSE fee filing with SEC; Supreme Court rebuffs exchanges

Updated with clarification

Recent transaction pricing tiers filed by the New York Stock Exchange with the Securities and Exchange Commission were challenged Friday by Healthy Markets, an investor-focused non-profit organization.

In a letter Friday, Healthy Markets Executive Director Tyler Gellasch said there is "insufficient information" to support NYSE's fee filing, and requested that the SEC begin proceedings to disapprove it.

When an exchange makes immediate rule filings related to fees or pricing, the SEC has 60 days to issue an order suspending it and institute proceedings.

In an interview, Mr. Gellasch said the challenge "is another front in the battle against conflicts of interest and non-transparent exchange practices, including what's influencing brokers' routing behavior and pricing tiers."

Separately, on Oct. 9, the Supreme Court denied a petition from major U.S. exchanges to review a case brought by some cities and public pension funds arguing that the exchanges' pricing structures help high-frequency traders at investors' expense.

The 2nd U.S. Circuit Court of Appeals in New York agreed March 20 with the petitioners — which include Providence, R.I.; $6.1 billion Plumbers and Pipefitters National Pension Fund, Alexandria, Va.; $1.1 billion Virgin Islands Government Employees' Retirement System, St. Thomas; and $5 billion Boston Retirement System — in their case against the exchanges, including Bats Global Markets, Chicago Stock Exchange, Nasdaq Stock Market and NYSE, and remanded the case for further proceedings.