Lehman Bros creditors issue JPMorgan suit

LEHMAN Brothers Holdings and a group of unsecured creditors yesterday sued JPMorgan Chase for more than $5bn (£3.5bn), accusing the bank of siphoning billions of dollars of critically-needed assets, and hastening its bankruptcy.

In a lawsuit filed in Manhattan bankruptcy court, the plaintiffs accused JPMorgan of extracting billions of dollars of collateral just before Lehman’s 15 September 2008, bankruptcy by threatening to otherwise deprive Lehman of clearing services critical to its broker-dealer business.

The lawsuit seeks to recover $5bn, representing collateral posted just before the bankruptcy. JPMorgan spokesman Joe Evangelisti called the lawsuit meritless.