JPMorgan Sues Perot Hedge Fund, Alleging Default

Dec 1 2008 | 2:05am ET

Just days before announcing that it would liquidate a fixed-income hedge fund, Parkcentral Capital Management defaulted on a margin call, according to a lawsuit filed by JPMorgan Chase.

The bank accused the Plano, Texas-based firm, which primarily manages money for the family of former U.S. presidential candidate H. Ross Perot, of defaulting on a Nov. 20 demand that it provide $125 million in eligible credit support as collateral on derivative contracts. It says it is owed as much as $753 million in collateral based on an early-termination agreement.

JPMorgan claims it hand-delivered three notices of default to Parkcentral. The lawsuit was filed in New York state court.

“By failing to perform its obligations under the master agreement, including its obligation to pay to JPMorgan the amount owing under the master agreement, Parkcentral has materially breached” that agreement,” JPMorgan alleges in the Nov. 26 suit.

Last week, Parkcentral told investors it was liquidating its six-year-old Parkcentral Global Hub Fund to pay off creditors. The $1.5 billion fund, which is down as much as 40% this year, is “no longer viable,” the firm said.


In Depth

Q&A: Schroders’ Forest Discusses Multi-Asset Investments On Eve Of U.S. Launch

Jul 17 2014 | 8:05am ET

Global investment manager Schroders has $446 billion in assets under management, $...

Lifestyle

Einhorns Busts At WSOP, Finishes In 173rd

Jul 15 2014 | 10:48am ET

Greenlight Capital founder David Einhorn’s World Series of Poker won’t end at...

Guest Contributor

Common Risk Parity Misperceptions

Jul 16 2014 | 11:02am ET

Over the past few years, risk parity has become a component of most investors’...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note