The U.S. District Court for the District of Nebraska (the "Court") granted a motion for the class certification of a claim against a broker-dealer for mishandling customer orders. The judge agreed that a computer algorithm could efficiently calculate damages for all class members and that damage calculations could be done at the individual customer level.
Plaintiffs alleged that TD Ameritrade Holding Corporation ("TD") systematically routed customers' trades to venues based on which venues better compensated TD rather than which offered the best execution of customers' orders, violating Exchange Act Rule 10b-5 and TD's duty to obtain the best execution for customers. TD's expert initially persuaded a magistrate judge that an individual determination of damages would be necessary. However, the Plaintiff's experts demonstrated that TD's computerized records of customer orders combined with computerized market data would allow plaintiffs to use a computer algorithm to automatically determine damages for any number of customers.
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