August 24, 2007
Attn: Ms. Nancy M. Morris, Secretary 8.24.07
Via: Electronic Mail Only Rule-Comments@SEC.gov
RE: FILE NUMBER SR-CBOE-2007-77
This letter is in reference to your File No. SR-CBOE-2007-77- and in SR-CBOE-2007-91 in which you invited comments from members of the class affected presently in litigation in Court of Law in Delaware and rule changes submitted by
CBOE in contention.
I have been a member of the Chicago Board of Trade since 1977 and CBOE Options Exchange, and the action by the CBOE has taken away my property rights and caused
damages to the income producing level of my seat, and the valuation of my seat due to damages with implementation of the leasing rules and termination of CBOT-CBOE
lease benefits to those class of members leasing their seats on CBOE.
The penalties, loss of income, damages and effects to my seat, and lease incomes are substantial if this rule change is implemented.
Attorneys representing my rights have stated that CBOE should continue under the agreements since 1973, all rights and priviledges should continue of my CBOT membership including voting rights and approvals for changes, be given me, as any other CBOE membership.
In addition CBOE demands I not only lose my right to lease the seat out to a CBOE trading right at $ 4500 -$ 5500 a month, I lose the right to lease it at all and have been
deprived of $ 4500-$ 5500 a month income (damages) and property value taken without compensation (eminent domain) by a private corporation without agreement,
compensation, and under a direct breach of contract, using a SEC Regulatory action as the mechanism to achive what a Court of Law is litigating as not legal and contractual.
The CBOE claim that the merged CME Global Inc. a Chicago Mercantile Exchange - Chicago Board of Trade Company extinguishes those rights is spurious at best, in that
the CBOT memberships have the same rights and privileges as they did prior to the merger, and accorded same as rights of CBOE Membership.
If logic were followed the CBOE way, every Money Center Bank merger combination, ie Chase Morgan, First Chicago/ Bank One, Goldman-Sumitomo, Citibank/Smith Barney, etc.,would have allowed interbank spot, forward and swap
contracts held between counterparties would be voidable, and chaos would have resulted by a simple merger making contracts done and cleared through the BIS settlements process, in good faith for $ trillions of dollars
voidable and unenforceable.
Until resoluton of this property rights dispute is made, in the the District Court of Delaware, no action or rule change should be implemented.
The CBOE assertion that the rule change is necessary to "maintain fair and orderly markets" is totally false, and casts a suspicious and onerous light on the SEC mandage for and purpose of its Regulatory process, and intent, to in affect use Regulatory law to achieve and supercede
fundamental rights afforded to property rights holders protected under the US Constitution, in the guise of Regulatatory SEC Mandate or Regulatory delegation of
This rule request not only causes liquidating damages, to me in the amount of $ 54000 per year from lost rental income, would also deprive fellow seat holders from leasing
seats, and the potential ability of those market-makers form making fair and orderly markets by removing them from the lease system at CBOE.
In addition, the rule request causes large damages as they are held in escrow, and impending against the value of the entire CBOE as a contigent and damaging liability
for intentional breach of contract, affecting the value of the CBOE and under contract my equal equity ownership interest in the $ 4 billion dollar institution of which the
damages ongoing cause substantial and irreplaceable loss to market value in the event of CBOE's sale or Initial Public Offering as an Underwritten Public Stock Offering.