A JPMorgan Chase unit has reached an agreement to pay $1.42 billion to resolve claims it took advantage of its status as Lehman Brothers Holdings' primary lender to unfairly extract cash and position itself ahead of other creditors in Lehman's bankruptcy.
Lehman Brothers said the settlement resolves two of the three major pieces of litigation with JPMorgan left over from its 2008 bankruptcy. The agreement settles Lehman's $6.3 billion in clearing-related claims and $2.3 billion in derivatives claims, according to a filing Monday in Manhattan federal court. Lehman said in the filing that the settlement will allow it to make additional payments of $1.496 billion to creditors.
In October, a judge threw out most of Lehman's claims to $8.6 billion taken as collateral by JPMorgan. Lehman has contended that the bank's demands helped force it into its $613 billion bankruptcy, the largest in U.S. history.
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WASHINGTON JPMorgan Chase and EverBank were released from business restrictions stemming from the foreclosure reviews that originated in 2011, but also face new civil money penalties for their earlier violations of those restrictions, the Office of the Comptroller of the Currency said Tuesday.
January 5 -
Bank chiefs should brace for a barrage of questions about economic uncertainty, if JPMorgan Chase's experience after releasing fourth-quarter results is any indication. Double-digit increases in loans and profits were not enough to stave off questions about the odds of recession, energy risks and adequacy of reserves.
January 14 -
A bankruptcy court judge sunk investors' hopes in their latest lawsuit against Lehman Brothers, which they claim broke contracts in junk mortgage-backed securities sold during the bubble years.
December 12
Lawyers for Lehman and a creditors' committee on Monday asked a federal judge in New York to approve the settlement.
Brian Marchiony, a JPMorgan spokesman, declined to comment on the agreement.
