Kraft Foods Group, Inc. and Mondelez Global LLC requested permission from the federal court hearing the enforcement action by the Commodity Futures Trading Commission against them for alleged manipulation to have a federal appeals court rule on two of the Commission’s central legal theories. These are whether (1) “a defendant’s large futures position, coupled with an alleged intent to affect market prices but absent any other false communication’s to the market” is prohibited “false signaling” manipulation and (2) whether the prices that result following a defendant’s purchases of futures positions in a market that cause futures and cash prices to converge are artificial prices. Defendants claim that an appellate court’s determination of these questions at this time would assist the court hearing the CFTC action to “properly” determine certain of defendant’s pretrial motions and to ensure that jurors receive proper instructions at trial. In April 2015, the CFTC filed a lawsuit against defendants claiming that wheat futures trades they entered on the Chicago Board of Trade for the alleged purpose of hedging were in fact entered for the purpose of artificially lowering prices in the related cash market. The CFTC accused the companies of engaging in manipulation and attempted manipulation through their activities, as well as engaging in a “manipulative or deceptive device or contrivance." Under law, the former allegation traditionally requires proof of intent and an artificial price, among other elements, while the latter does not. (Click here for details regarding the CFTC’s lawsuit in the article, “Manipulation Is Not Hedging Says CFTC in Federal Court Lawsuit Against Kraft Foods Group and Mondelez Global” in the April 5, 2015 edition of Bridging the Week.) Defendants previously argued that at least two of the counts of the CFTC’s complaint should be dismissed because the pleadings did not describe how the defendants allegedly deceived the market and because the CFTC failed to plead that the firms’ conduct caused an artificial price and they had the requisite specific intent. (Click here for details regarding the defendants’ motion to dismiss in the article, “Kraft Foods and Mondelez Global Seek to Dismiss Parts of CFTC’s Manipulation Complaint” in the June 7, 2015 edition of Bridging the Week.) The court denied defendants’ motion.