## Facts

- The Commodity Exchange Act (CEA) regulates commodity futures trading and contains antifraud and anti-manipulation provisions, but does not expressly authorize private damages suits.
- In 1974, Congress enacted the Commodity Futures Trading Commission Act, creating the Commodity Futures Trading Commission (CFTC) and authorizing an administrative reparations remedy for certain CEA violations by specified market professionals.
- J. J. Curran sued his futures commission merchant (Merrill Lynch) alleging fraud in violation of the CEA.
- Other speculators sued the New York Mercantile Exchange, certain exchange officials, and futures commission merchants, alleging unlawful price manipulation and failures to enforce exchange rules as required by the CEA’s self-regulation scheme.
- The statutory amendments in 1974 did not expressly address whether private parties could sue in federal court for damages under the CEA.

## Issues

1. Whether the CEA, as comprehensively amended in 1974 to create a CFTC reparations procedure, still permits an implied federal private right of action for damages for CEA violations.
2. Whether purchasers and sellers of futures contracts may sue for damages for violations of the CEA’s antifraud provisions and provisions aimed at preventing price manipulation.

## Decision

- The Supreme Court affirmed the judgments recognizing an implied private right of action under the CEA (5–4, Stevens, J.).
- A private party may maintain an action for damages caused by a violation of the CEA.
- Congress’s 1974 comprehensive amendments, enacted against a backdrop of preexisting lower-court recognition of implied CEA damages actions, were treated as preserving that remedy when Congress left the relevant provisions intact.
- The CFTC reparations procedure was held to be an additional enforcement mechanism, not an exclusive substitute that displaced private judicial remedies.
- Purchasers and sellers of futures contracts have standing to assert damages claims based on both (a) antifraud violations and (b) violations of provisions designed to prevent price manipulation.

## Legal Principles

- In determining whether a statute supports an implied private right of action, the controlling inquiry is congressional intent.
- When Congress substantially amends a statutory scheme while leaving unchanged provisions that courts have interpreted to support an implied remedy, that legislative choice is evidence Congress intended to preserve the remedy.
- Congress is presumed aware of established judicial interpretations when it reenacts or leaves intact statutory language during comprehensive revision.
- Creation of an administrative remedy does not, by itself, eliminate a previously recognized implied judicial damages remedy absent clear indication Congress intended exclusivity.

## Conclusion

The Court held that the CEA implies a private federal damages action for traders injured by fraud or price manipulation, concluding that Congress’s 1974 creation of CFTC reparations and related amendments did not extinguish the preexisting, judicially recognized private remedy and instead left it in place alongside administrative enforcement.


Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Curran, 456 U.S. 353 (1982)