(Refiles Nov. 18, article to delete second Citadel reference in the third paragraph.

Jonathan Stempel

(Reuters] -A U.S. court dismissed a lawsuit alleging that Robinhood Markets Inc (NASDAQ:), and other brokerages that wrongly prevent retail investors buying high-rise “meme stock” stocks, triggering a sale.

On Wednesday, Cecilia Altonaga, the Chief Judge of Miami’s Federal Court in Miami, found that there was no evidence of any illegal conspiracy to stop social media-fueled trade. GameStop Corp (NYSE:), AMC Entertainment, (NYSE:) Holdings Inc. Bed Bath & Beyond Inc (NASDAQ:) And six other stocks.

According to investors in the class action, Citadel Securities LLC was accused of conspiring with brokerages to end a “short-squeeze” which had caused losses of billions of dollar for hedge funds who were betting on falling stock price.

Investors claimed that they had no choice but to exit the market at plunging prices because of January’s trading restrictions.

Altonaga, however, stated that in her 51 page decision the investors were “far from” providing evidence of an antitrust conspiracy despite emails between senior Citadel and Robinhood officials that gave “some credence to” their claims.

“(A)re some vague and ambiguous email exchanges between two businesses in an otherwise lawful, continuing business relationship sufficient to push plaintiffs’ claims across the line of plausible to conceivable?” Altonaga wrote. “The court doesn’t think so.”

Altonaga also dismissed related claims against E*Trade Financial (NASDAQ:) Corp and four other defendants.

Frank Schirripa (a lawyer representing investors) stated on Thursday that the investor’s were disappointed and would be amending their complaint over the coming weeks.

Robinhood stated in a statement that “This confirms that conspiracy theories of collusion have no foundation in reality.”

Citadel expressed satisfaction with the decision. E*Trade declined to comment. Robinhood could also be accused of negligence in another proposed class action.

The meme stock frenzy has been fueled https://www.reuters.com/business/why-did-sec-release-report-gamestop-2021-10-18 by investors using online forums such as Reddit and Twitter (NYSE:).

Due to the COVID-19 pandemic many traders traded at home through brokers that have eliminated trading commissions.

Last month, the U.S. Securities and Exchange Commission said in a report https://www.reuters.com/business/us-sec-praises-equity-market-structure-absolves-short-sellers-gamestop-report-2021-10-18 that markets essentially worked well during the volatility. It did not recommend any changes to policy.

This case is called In re January 2020 Short Squeeze Trading Litigation. U.S. District Court Southern District of Florida No. 21-md-02989.