Barclays wins bid to slash UK investors' $727 million 'dark pool' lawsuit

LONDON (Reuters) - Barclays on Friday won its bid to more than halve a shareholders' lawsuit worth up to 560 million pounds ($727 million) at London's High Court for allegedly misleading the market about its private "dark pool" trading platforms.

A judge ruled that investors who only relied on Barclays share value or listed status could not continue with their claims, and said he hoped this would improve the chances of an early settlement ahead of a planned trial in October 2025.

Barclays declined to comment on the ruling.

Hundreds of institutional investors are suing after more than 2 billion pounds was wiped off Barclays' value in 2014, when New York's attorney general filed a complaint against the lender over a trading system known as "Barclays LX".

The investors say Barclays misled its clients about Barclays LX – a "dark pool" trading venue where orders are not visible to other traders until they are executed – and that the bank did not publish relevant information to shareholders.

Barclays settled the New York case in 2016, agreeing to pay a $70 million fine, admit violating securities laws, and to install an independent monitor.

Barclays applied in July for more than half of the case – representing some 330 million pounds of its total value – to be thrown out, which Judge Thomas Leech allowed on Friday.

The bank's lawyer Helen Davies argued that it was essential in a shareholder lawsuit that claimants had relied on information published by a listed company.

This meant, she argued, that claims by investors who said they relied only on Barclays' share value or listed status could not continue.

Signature Litigation, the law firm representing the claimants, said in a statement: "In our view it is not appropriate for Barclays to seek to shut out such investors from the statutory remedy and it is likely we will be seeking to appeal it (the ruling)."

(Reporting by Sam Tobin; editing by William James and Jason Neely)