Peregrine Financial Group, Inc. Trustee Website

    Hon. Carol A. Doyle
    Northern District of Illinois
    Jul 10, 2012
    Dec 14, 2012

Case Overview


On February 21, 2020, the Trustee filed the Trustee’s Motion for Entry of an Order Authorizing Additional Interim Distributions on Allowed 4d Customer Claims (the “Motion”). In the Motion, the Trustee requests authority from the Bankruptcy Court to make up to a 72.16% interim distribution from segregated and non-segregated cash to the holders of Allowed 4d Customer Claims (the “Proposed Distribution”).

With respect to holders of Allowed 4d Customer Claims that received all prior distributions, the proposed incremental distribution will be 9.16%. Holders of Allowed Futures Claims that did not receive the full amount of their prior distributions will receive their pro rata share of the undistributed portion of all prior distributions.

The Trustee also requested authority from the Bankruptcy Court to set 11:59 p.m. (CST) on February 20, 2020 as the “Record Date” for the Proposed Distribution. As of the Record Date, the claims register shall be closed for the purposes of the Proposed Distribution and the Trustee shall have no obligation to recognize any transfer of any claims occurring after the Record Date. The Proposed Distribution checks will be mailed to the customer at the address contained in the proof of claim as of the Record Date.

The Motion is scheduled for hearing on March 18, 2020 at 10:00 a.m. (CST) in Courtroom No. 742, United States Courthouse, 219 South Dearborn Street, Chicago, Illinois, before the Honorable Judge Carol A. Doyle, Bankruptcy Judge, or such other Judge who may be sitting in her place and stead. The hearing may be continued from time to time without further notice other than by announcement in open court. A copy of the Motion and the proposed order is available here.


On August 7, 2017, the United States Court of Appeals for the Seventh Circuit affirmed rulings by the United States District Court and the United States Bankruptcy Court in favor of Ira Bodenstein, chapter 7 trustee of the Peregrine Financial Group, Inc. (“PFG”) bankruptcy estate, relating to the treatment of claims by customers who held accounts with PFG for retail foreign exchange (“Forex”) and over-the-counter spot metals (“Metals”) trading.

In Secure Leverage Group Inc., et al. v. Bodenstein, a group of former Forex and Metals customers sought the return of funds held by PFG at the time of its bankruptcy on the grounds that Forex and Metals contracts were “commodity contracts” within the meaning of the Bankruptcy Code. Therefore, the plaintiffs argued, their claims were entitled to the same priority afforded to futures customers. The Secure Leverage claimants also asserted that PFG held the funds they deposited for Forex and Metals trading in trust, such that those funds are not part of the bankruptcy estate. Judge Carol A. Doyle of the Bankruptcy Court rejected both theories and, on appeal, U.S. District Judge John J. Tharp Jr. agreed, endorsing the Bankruptcy Court’s rationale and affirming its judgment in favor of the Trustee.

In Miller, et al. v. Bodenstein, a second group of Forex and Metals claimants, represented by the same attorneys as the Secure Leverage plaintiffs, filed a class action lawsuit on behalf of all of PFG’s former Forex and Metals customers, in which they asserted new legal theories in support of their claims for the return of funds deposited for Forex and Metals trading. Because the Miller class action lawsuit was filed more than two years after the claims bar date, the Bankruptcy Court dismissed the lawsuit as untimely. Again, Judge Tharp agreed and affirmed the Bankruptcy Court’s entry of judgment in favor of the Trustee.

On further appeal, the Court of Appeals found Judge Tharp’s decision to be a “thorough and well-reasoned opinion” that “properly resolved all of [the Forex and Metals claimants’] challenges.” As such, the Court of Appeals adopted the District Court’s opinion as its own, and entered final judgment affirming the District Court.



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