JP Morgan Chase countersues
(2 December 2010 – USA) JP Morgan Chase is countersuing Lehman Brothers, claiming the bankrupt group misled the investment bank into lending more than US$70 billion (A$71 billion) under the pretence it would be repaid in full.
Lehman Brothers filed a lawsuit against JPMorgan earlier this year, accusing the second-largest U.S. bank of illegally siphoning billions of dollars of desperately-needed assets in the days leading up to its record bankruptcy.
In the suit filed on Wednesday, JP Morgan claimed that it loans more than US$70 million to the now bankrupt US investment bank on September 18th 2008.
JP Morgan said it loaned the funds believing it would be paid back in full after British bank Barclay’s purchased Lehman’s US brokerage business.
However, Lehman helped Barclays cherry pick the securities it wanted to buy back and left behind billions of dollars of the worst securities, JPMorgan claimed in the filing.
Following the commencement of Lehman's liquidation on Sept 19, 2008, JPMorgan said it was stuck with more than $25 billion of loans secured by Lehman's toxic securities.
'Only later was JPMorgan able to determine that the position in which it unexpectedly found itself was the result of collusion and deception by Lehman and Barclays,' JPMorgan said in the court filing.
In its countersuit, JPMorgan has requested damages and asked the court for protection from Lehman's claims of losses and liabilities against it.
In the suit filed on Wednesday, JP Morgan claimed that it loans more than US$70 million to the now bankrupt US investment bank on September 18th 2008.
JP Morgan said it loaned the funds believing it would be paid back in full after British bank Barclay’s purchased Lehman’s US brokerage business.
However, Lehman helped Barclays cherry pick the securities it wanted to buy back and left behind billions of dollars of the worst securities, JPMorgan claimed in the filing.
Following the commencement of Lehman's liquidation on Sept 19, 2008, JPMorgan said it was stuck with more than $25 billion of loans secured by Lehman's toxic securities.
'Only later was JPMorgan able to determine that the position in which it unexpectedly found itself was the result of collusion and deception by Lehman and Barclays,' JPMorgan said in the court filing.
In its countersuit, JPMorgan has requested damages and asked the court for protection from Lehman's claims of losses and liabilities against it.
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