TLDRSusquehanna’s motion to freeze approximately $100 million in assets allegedly connected to insider trading was rejected by a federal judge in New YorkInsufficient evidence shown that defendants would conceal or transfer assets prior to final judgmentPlaintiffs failed to demonstrate that traders possessed material nonpublic information before China’s May 22 policy announcementBoth preliminary injunction and asset attachment motions were dismissed by the courtMultiple defendants presented evidence suggesting their trading decisions were influenced by publicly observable market patternsA federal judge in New York has rejected Susquehanna Securities and Susquehanna Investment Group’s motion to freeze approximately $100 million allegedly connected to an insider trading operation related to China’s regulatory actions against cross-border trading services.A federal judge dealt a setback to Susquehanna's lawsuit claiming it lost tens of millions of dollars to insider trading on a Chinese regulatory crackdown, denying a request to keep the alleged traders’ accounts frozen https://t.co/8eaxi2ovuD— Bloomberg (@business) September 15, 2026Judge Arun Subramanian of the U.S. District Court for the Southern District of New York delivered the decision on September 14. The lawsuit, originally filed by Susquehanna on June 29, targets 100 unidentified defendants with allegations of Securities Exchange Act of 1934 Section 20A violations and claims of unjust enrichment. Citadel Securities subsequently entered the litigation as an intervenor party.The case revolves around trading patterns that preceded May 22, the date Chinese authorities unveiled their crackdown on cross-border trading services. According to Susquehanna’s allegations, the defendants purchased short-term put options armed with confidential, material information, profiting substantially when the regulatory announcement triggered significant price declines in affected securities.Insufficient Evidence of Asset Flight RiskSusquehanna reduced its freeze target from 100 defendants to 40 individuals. The firm petitioned the court to prevent these defendants from transferring or liquidating profits maintained at external brokerage firms.Judge Subramanian determined that Susquehanna failed to present adequate evidence demonstrating a genuine risk that defendants would conceal or relocate their assets ahead of a final ruling. The court emphasized that granting Susquehanna’s position would essentially permit asset freezes in nearly any insider trading lawsuit without proper substantiation.The most compelling evidence Susquehanna offered concerned John Doe 3, a defendant who reportedly transferred over $10 million from an account before restrictions could be imposed. However, the court found this claim unconvincing due to insufficient supporting documentation and noted that transferring funds from trading accounts doesn’t inherently indicate judgment avoidance behavior.Public Market Data Defense Gains TractionSusquehanna encountered significant difficulty establishing that defendants probably traded based on confidential information instead of publicly accessible market indicators.Zhengfei Li, one named defendant, presented trading documentation revealing two identical positions, with half set to expire before May 22 and the remainder afterward. Li maintained his trades resulted from observing exceptionally high put option volume in publicly available market data rather than confidential intelligence. He noted that on May 21, the put-to-call ratio reached approximately 49 to 1, data he claimed informed his trading strategy. A separate defendant produced communications demonstrating her shock upon learning of the Chinese regulatory action, which the court found supported a narrative of lacking advance knowledge.The court concluded that defendants may have responded to publicly accessible market indicators, which wouldn’t constitute nonpublic information under insider trading statutes.Additionally, Susquehanna failed to identify the alleged information source, establish any fiduciary relationship that was breached, or demonstrate any personal benefit exchanged for sharing the information.Judge Subramanian similarly rejected Susquehanna’s backup request for an asset attachment order, concluding the firm hadn’t demonstrated probable success on either legal theory.A previous temporary order restricting the disputed funds expired at 5 p.m. ET on September 16.The post Court Rejects Susquehanna’s Attempt to Lock Down $100M in China Trading Case appeared first on Blockonomi.