Those delays experienced by E*Trade customers on October 27 and 28 during the wild market swings on Wall Street (CI No 3,282) have brought about a class action suit against the online investment brokerage. E*Trade had to temporarily limit access to trading services during the busy period to avoid a massive slowdown. Now the affected customers have filed suit against E*Trade, alleging that the company knowingly took on more customers than it was equipped to handle. The suit contends that significant amounts of money were lost by investors who either couldn’t access the service or saw trades executed too slowly as the market raced up and down. The class is seeking an injunction that would prohibit E*Trade from actively seeking new accounts through any marketing activity until its system is expanded enough to handle the kind of trading activity that forced the delays. E*Trade has previously said it would be spending an additional $20m this year to build up its capacity from 15,000 users at a time to 25,000 (CI No 3,289). E*Trade shares fell $3.00 to $23.5625 on Tuesday.
