(C) Reuters. FILE PHOTO: The welcome screen for the Robinhood App is displayed on a screen in this photo illustration January 29, 2021. REUTERS/Brendan McDermid/Illustration
By Nate Raymond
BOSTON (Reuters) -A Massachusetts judge on Thursday rejected Robinhood’s bid to block state regulators from moving forward with their enforcement action alleging that the online brokerage encourages inexperienced investors to place risky trades without limits.
Suffolk County Superior Court Judge Kenneth Salinger rejected a request by Robinhood to block Massachusetts Secretary of State Bill Galvin’s case, which seeks the revocation of the company’s broker-dealer license in the state.
Menlo Park, California-based Robinhood sued in April and sought to block the administrative case from moving forward while it pursued a legal challenge to the state’s new fiduciary rule, which raised the investment-advice standard for brokers.
But Superior Court Judge Salinger said that while Robinhood could continue challenging that rule’s validity in court, “it does not follow that the Court should enjoin the pending administrative action.”
Robinhood did not respond to a request for comment.
Robinhood cannot block Massachusetts securities regulators’ case, judge rules
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