Board of Trade of the City of Chicago v. Securities and Exchange Commission
United States Court of Appeals for the Seventh Circuit
923 F.2d 1270 (1991)
A broker, a clearing agency, and a bank created Delta, a computer system matching buyers and sellers of options on federal government securities and notifying them when a deal was reached. Delta sought SEC registration as a clearinghouse; the Chicago Board of Trade (plaintiff) intervened to argue Delta first had to register as an exchange. The Seventh Circuit initially remanded for the SEC to decide the exchange question, and the SEC (defendant) concluded Delta was not an exchange. The Board of Trade appealed that determination.
Whether the generally understood definition of a stock exchange requires a trading floor and specialists or brokers who enhance market liquidity, such that a computerized matching system like Delta falls outside that definition.