A federal magistrate judge in Florida stayed discovery in McCrudden v. TopstepFunded LLC on August 10, 2026, freezing the case while the court decides whether the dispute belongs in arbitration. The suit claims Topstep’s trading programs are an unregistered commodity pool. The court has decided nothing on that claim. Topstep evaluation and funded-account holders see no change to their accounts.
What the court ordered
Magistrate Judge Laura Lothman Lambert granted the defendants’ motion to stay proceedings and discovery, filed July 17, 2026 (Doc. 30). Discovery is stayed as to all parties until the motion to compel arbitration is resolved. The case, 3:26-cv-00816-WWB-LLL in the Middle District of Florida, was filed April 9, 2026. All defendants moved on June 8 to compel arbitration and stay the case, or dismiss it in the alternative (Doc. 19), then filed a renewed motion to compel arbitration on June 30 (docket).
The commodity pool claim
The named defendants include TopstepFunded LLC, Topstep LLC, TopstepTrader, LLC and individual executives. In its June 8 motion, the firm argues that “Topstep’s programs are not a ‘commodity pool’” within the meaning of the Commodity Exchange Act (CEA), the federal law governing futures trading. Topstep says the Combine and the XFA involve simulated trading only, that LFA trading uses its own proprietary capital, and that private CEA claims must proceed under 7 U.S.C. section 25.
The arbitration dispute
The plaintiff’s July 13 response argues the arbitration clause conflicts with CFTC Rule 166.5 and NFA Compliance Rule 2-53, and notes that Topstep Brokerage LLC is a CFTC-registered introducing broker and NFA member with NFA ID 0567079. The same filing alleges the Topstep entities obtained NFA registrations and principal approvals after the action was filed, an allegation the court has not tested, and asks for a stay rather than dismissal if arbitration is compelled (Doc. 28).
Topstep replied on August 3 that trading a real live account does not make the plaintiff a “customer” under 17 C.F.R. 166.5 or NFA Rule 2-53. It points to the Live Funded Account agreement, under which the firm “is engaged in trading futures for its own account and risk”, and says participants hold no ownership interest in the master account and no right to contribute or withdraw capital. Program fee revenue used to fund proprietary trading, the reply argues, does not establish a commodity pool.
What it does not change
The August 10 order is procedural. No court has ruled on whether the programs are a commodity pool, and no finding has been made against Topstep. An evaluation remains a paid service with simulated trading, and the account terms that bind a trader come from the agreement signed with the firm rather than from the docket.
