Wednesday, May 16, 2012

MURRAY FRANK LLP files class action suit against JPMorgan Chase & Co in behalf of shareholders regarding $2 billion trading loss

This the second class action against Chase:

-- MURRAY FRANK LLP announces that it has filed a class action complaint in the United States District Court for the Southern District of New York on behalf of purchasers common stock in JPMorgan Chase & Co. ("JPMorgan" or the "Company") between April 13, 2012 and May 10, 2012, inclusive (the "Class Period").

The lawsuit alleges violations of the Securities Exchange Act of 1934 (the "Exchange Act") that occurred when the Defendants issued materially false and misleading statements regarding the losses and risk of loss to the Company arising from massive bets on derivative contracts related to credit indexes reflecting interest rates on corporate bonds. These derivative bets went horribly wrong, resulting in billions of dollars in lost capital for the Company and billions more in lost market capitalization for JPMorgan shareholders.

As alleged in the lawsuit, JPMorgan's credit index derivative positions were so large that they generated market rumors and press coverage in the weeks leading up to the Company's April 13, 2012 earnings conference call with investors. Specifically, the lawsuit alleges that instead of disclosing the extremely risky nature of JPMorgan's derivative bets, and the actual losses that had been incurred at the time, Defendants falsely characterized the derivative positions as mere "hedging" strategies. JPMorgan's CEO, Defendant James "Jamie" Dimon, went so far as to call press reports about the Company's derivative positions a "complete tempest in a teapot."

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