Saturday, 20 December 2014
Last updated 15 hours ago
Nov 13 2008 | 12:55am ET
A New York judge has given the green light to collapsed hedge fund Amaranth Advisors’ lawsuit against JPMorgan Chase, accusing the firm of breaching its client agreement as Amaranth’s prime broker.
According to Amaranth, which imploded after losing more than $6 billion on bad natural gas bets two years ago, alleges that JPMorgan refused to release money the hedge fund had in its prime brokerage account that it needed to close a deal with Goldman Sachs to buy the toxic natural gas trades. Amaranth said JPMorgan used its position as clearing broker to refure to executive a Sept. 18, 2006, trade that would have sent Goldman its natural gas portfolio and $1.85 billion. JPMorgan and Citadel Investment Group later bought the trades, after Goldman had pulled its offer, for much less than Goldman’s offer, turning a substantial profit for itself.
Although the proposed deal with Goldman had the Wall Street giant taking on all further losses from the trades, JPMorgan argued that it would have been stuck with potential losses had it released the funds to Amaranth. It called the hedge fund’s lawsuit, filed in November, “baseless.”
But New York State Supreme Court Justice Richard Lowe ruled that the bank did “not conclusively establish a defense to the breach of contract claim as a matter of law.”
The judge dismissed the other five claims Amaranth had made against JPMorgan, including one alleging that top JPMorgan officials had engaged in rumor-mongering about Amaranth and unfair trade practices.
Dec 1 2014 | 10:21am ET
As 2014 winds down, Northern Trust Hedge Fund Services executives took some time to share their outlook on trends facing the industry in 2015. Read more…
Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.