Institutional investors often trade large blocks of stock, which can be difficult to trade on the exchanges. Hence, many block sales are privately negotiated but still must be reported on the exchange. Buyer and seller place limit orders at the specified price, which the specialist can see on his book.
In order to execute the block trade the buyer or seller must execute the orders that stand between the market price and the agreed transaction price. In front running, the specialist or stock insiders place their own orders between the market and agreed prices knowing that they will be immediately executed at a profit.