The US trial court handling the enforcement action by the Commodity Futures Trading Commission against Kraft Foods Group, Inc. and Mondelez Global LLC (collectively, “Kraft”) over Kraft’s alleged manipulation of wheat futures contracts in 2011, denied Kraft’s June 2015 motion to dismiss two counts of the case. The CFTC claimed in its initial enforcement action that wheat trades entered by Kraft for the alleged purpose of hedging were in fact initiated for the purpose of artificially lowering prices in the related cash market. This activity, claimed the CFTC, was a violation of federal law and the Commission’s rules. Kraft had sought to dismiss one count of the Commission’s complaint that relied on the CFTC’s recently gotten anti-manipulative or deceptive device or contrivance authority under the Dodd-Frank Wall Street Reform and Consumer Protection Act claiming, “[a]t its core, the CFTC’s complaint accuses [the firms] of fraud and manipulation for seeking to purchase wheat at the best price it could in the face of difficult market conditions.” Additionally, Kraft said that the Commission’s claims under its traditional manipulative authority should also be dismissed because the CFTC failed to plead that the firms’ conduct caused an artificial price and they had the requisite specific intent. At the outset, the Court rejected the Commission’s claim that the CFTC’s new manipulative device authority creates two causes of actions—one for manipulation and one for fraud. The Court held this new authority only creates a cause for fraud, although the fraud could involve “fraudulent manipulation or misconduct in the marketplace.” Notwithstanding, the Court held that the CFTC satisfied its burden to plead (not at this stage, prove) fraudulent manipulative conduct by alleging “… what manipulative acts were performed, which defendants performed them, when the manipulative acts were performed and what effect the scheme had on the market for the commodities at issue,” and that's Kraft purported conduct was either reckless or intentional. Likewise, the court claimed that the CFTC satisfied its pleading obligations to allege manipulation and attempted manipulation.