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Lehman sues JP Morgan in assets dispute

LEHMAN Brothers Holdings has sued JP Morgan Chase, accusing the bank of illegally siphoning billions of dollars of assets in the days leading up to the record bankruptcy.

The lawsuit filed in a Manhattan bankruptcy court accused JP Morgan of using its “unparalleled access” to inside details of Lehman’s distress to extract $8.6bn (£5.9bn) of collateral, including $5bn on the final business day.

JP Morgan was Lehman’s main “clearing” bank.

According to the complaint, JP Morgan knew from this relationship that Lehman’s viability was fast weakening.

A JP Morgan spokesman called the lawsuit “meritless” and said the bank will defend itself against the charge.