Monday, 1 September 2014
Last updated 3 days ago
Jun 24 2011 | 11:49am ET
Hedge fund Aurelius Capital Management has turned its back on a deal it helped devise to settle Washington Mutual’s reorganization.
Aurelius now says the deal unfairly benefits JPMorgan Chase & Co., which bought WaMu’s banking operations.
In a court filing on Wednesday, reports Reuters, Aurelieus argued the delay in implementing the deal has drained money from creditors and suggested JPMorgan contribute more to the settlement.
Aurelius, along with three other hedge funds— Appaloosa Management, Centerbridge Capital Partners and Owl Creek Asset Management—crafted the so-called "global settlement" last year to end legal battles between WaMu, JPMorgan and the Federal Deposit Insurance Corp. For their efforts in ending lawsuits, the four were to share about $10 billion of disputed assets.
Those disputed assets include $4 billion that was on deposit with WaMu’s former bank, which JPMorgan bought from the FDIC in 2008. WaMu filed for bankruptcy the day after the sale. Aurelius argues JPMorgan could have earned over $400 million on those deposits since the start of the bankruptcy, while paying only $20 million (0.2% annually) in interest.
"At this time, the Amended Global Settlement Agreement should not be approved as fair unless (JPMorgan) provides additional value to the debtors to compensate for the substantial delays," Aurelius said in a filing with Delaware's bankruptcy court.
Reuters says an attorney for WaMu expressed surprised at the filing, in light of the court’s approval of the global settlement.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...