Online brokerage, E*Trade has filed a countersuit against MarketXT Holdings in Manhattan's federal court, alleging that the smaller firm presented it with misleading revenue and trading volume figures in order to ensure that E*Trade would complete the $280 million takeover of online trading firm, Tradescape.com in 2002.
MarketXT has alleged that E*Trade "made material misrepresentations" to persuade it to sell Tradescape.com, and that the world's third largest online brokerage now refuses to pay for the operation.
However, in its recently filed countersuit, E*Trade announced that:
"Defendants concealed declining trading volume and revenues for the Tradescape entities and artificially pumped up their balance sheet with false 'assets' to ensure E*Trade would proceed to closing ignorant of the true financial conditions of the Tradescape entities."
According to reports, E*Trade is seeking $20 million in compensation, and at least $100 million in punitive damages.
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