CBOE currrently has an exclusive licence to trade options on the S&P 500 and the Dow Jones Industrial Average.

But earlier this month the ISE filed a suit in a New York federal court seeking a declaratory judgment allow it to list options on the Dow Jones Industrial Average and S&P 500 index without a licence from the owners of the indexes. The ISE said that both S&P and Dow Jone have refused to grant it license to list these indexes.

In response the Chicago exchange Dow Jones and Standard & Poor's parent company McGraw-Hill have filed a joint suit in Cook County, Illinois to prevent the ISE listing the indexes.

"ISE seeks to free-ride on the extraordinary investments of time, effort, and money that each Plaintiff has made over the years in the respective indexes ... in order to take advantage of Plaintiffs' substantial investments and to misappropriate plaintiffs' proprietary rights and license rights for ISE's own financial gain," says the complaint.

In a statement, William Brodsky, CBOE chairman and CEO, says: "Cboe initiated this action in order to enforce our contractual rights with our partners, S&P and Dow Jones."

S&P is seeking to bar the ISE from listing or trading options on the index unless it grants the exchange a licence. At the same time Dow Jones is seeking to prevent the ISE from listing and trading options on the Dow Jones industrial average without a licence.

The Options Clearing Corporation is also named as a defendant in the complaint, because of the role that it plays in the creation and issuance of options on behalf of ISE.