Barclays Gets Sympathetic Hearing in ETN Reverse Split Appeal

Barclays PLC appeared to come away from oral argument Monday at the Second Circuit with the upper hand over investors who want their money back for exchange-traded notes that they say are unsellable.

The panel of judges had difficulty seeing how the ETNs’ alleged illiquidity following a 4:1 reverse split equated to a change in “value” that would turn the exchange into a sale subject to certain securities law provisions. “You’re saying the stock split is undesirable, but it’s unclear to me” whether that establishes that value was exchanged, one of the judges of the US Court of Appeals for ...