JPMorgan Chase has reached a settlement with the liquidators for two Bear Stearns mortgage-laden hedge funds.
The liquidators, Geoffrey Varga and William Cleghorn, agreed to voluntarily withdraw the lawsuit against Bear Stearns’s asset-management unit, which sought to recover at least US$1.1 billion in losses.
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Two former Bear Stearns Cos managers Ralph Cioffi and Matthew Tannin, and auditor Deloitte & Touche were accused of misleading investors in two hedge funds with holdings in subprime mortgages that imploded and filed for bankruptcy in July 2007.
Terms of a settlement with Bear Stearns Cos, which JPMorgan acquired in 2008, were not disclosed.
The lawsuit was brought by the liquidators for Bear Stearns High-Grade Structured Credit Strategies (Overseas) Ltd and Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage (Overseas) Ltd.
Two former Bear Stearns fund managers were acquitted after a federal trial in Brooklyn New York in 2009 of charges they misled investors in the funds losses of US$1.05 billion.
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By GlobalDataThe complaint was filed by Stillwater Capital Partners LP of New York, Essex Fund Ltd. of the Cayman Islandsalong with two liquidators, Varga and Cleghorn to recover losses for investors in feeder funds.
