|[March 19, 2013]
Entwistle & Cappucci LLP, Berger & Montague, P.C. and the Trustee for the MF Global Liquidation Announce Proposed Settlement of Claims Against JPMorgan
NEW YORK --(Business Wire)--
Co-Lead Counsel for the Class of MF Global Inc. ("MFGI") customers and
James W. Giddens, the trustee ("Trustee") for the liquidation of MFGI,
have announced a settlement ("Settlement") of all claims against
JPMorgan Chase Bank, NA and its parents, subsidiaries and affiliates
("JPMorgan"). The proposed Settlement will be contemporaneously
presented by motions for approval to both District Court Judge Victor
Marrero and to Bankruptcy Court Judge Martin Glenn.
The proposed Settlement, which will resolve all of the Customer
Representatives' and Trustee's potential claims against JPMorgan arising
both from transfers of Customer Property during the days preceding
MFGI's collapse and from JPMorgan's conduct as one of MFGI's primary
banks and repositories of Customer Property, provides a sizable benefit
to the Settlement Class of former customers of MFGI. Subject to Court
approval, the Customer Representatives, on behalf of themselves and the
proposed Settlement Class, and the Trustee, on behalf of MFGI's estate,
have agreed to settle their respective claims against JPMorgan for the
following consideration: (i) a $100 million cash payment from JPMorgan
for distribution to customers; (ii) a release by JPMorgan of its
security interests in approximately $417 million it previously returned
to the Trustee, freeing such funds to be allocated to MFGI's customer
estates as described below; and (iii) the return of approximately $29
million in additional funds held by JPMorgan to secure potential
obligations under a certain revolving credit facility agreement and
JPMorgan's clearance and other agreements with MFGI, for a total value
to customers and the estate of approximately $546 million.
Upon approval, the Settlement will enable the Trustee to immediately
seek to allocate $250 million to the 4d Customer Estate for the benefit
of MFGI customers who engaged in commodity transactions on domestic
exchanges ("4d Customers") and $50 million to the 30.7 Customer Estate
for the benefit of customers who transacted on foreign exchanges ("30.7
Customers"). Moreover, the Settlement with JPMorgan will satisfy an
important condition to the effectiveness of the settlement between the
Trustee and the Joint Special Administrators of MF Global UK Limited
("MFGUK"), approved by the Bankruptcy Court on January 31, 2013, which
will failitate the recovery from MFGUK of approximately $500-$600
million (over time) for additional distribution to customers and general
creditors. All told, the Settlement will ultimately enable the Trustee
to distribute to customers an amount approaching $1 billion.
The Class is continuing to pursue its claims against the former
directors and officers of MFGI, including Jon Corzine, and against
MFGI's former auditor, PricewaterhouseCoopers (News - Alert) and MFGI's primary
regulator, the CME Group.
Co-Lead Counsel for the customers, Andrew Entwistle of Entwistle &
Cappucci LLP and Merrill Davidoff of Berger & Montague, P.C., were
especially pleased with the Settlement. Attorney Entwistle observed
that: "This Settlement reflects the cooperative efforts of our team and
the Trustee over many months of investigation and negotiations with
JPMorgan and is a key recovery for the Customers both in its own right
and as the lynchpin to the UK settlement recently approved by Judge
Glenn." Attorney Davidoff observed that: "We are pleased JPMorgan
elected to resolve these claims early enough to enable the Trustee to
return significant sums to customers whose funds were unlawfully
diverted and especially that the contemporaneous release of liens
asserted by JPMorgan will return hundreds of millions of dollars that
can be distributed once the Settlement becomes final."
Entwistle also observed that: "While a substantial shortfall will still
remain for 4d and 30.7 Customers, the $800m-900m that this Settlement
will cause to be paid to customers over time is a tremendous step
forward in this process." Davidoff further stated that: "Nearly a year
and a half has passed since the management of MFGI improperly
transferred hundreds of millions of dollars in segregated customer
property for use by the firm, while PwC and CME Group enabled their
reckless behavior. It is time that the remaining parties pay for their
improper behavior and make MFGI's former customers whole."
More information about the case can be found at http://www.entwistle-law.com/resources/MF.
The filed case number is 11-cv-7866 (VM) (U.S. Dist. Ct., S.D.N.Y.).
About Entwistle & Cappucci LLP
Entwistle & Cappucci is a national law firm providing top-flight legal
representation and exceptional service to clients that include major
public corporations, a number of the nation's largest public pension
funds, governmental entities, leading institutional investors, domestic
and foreign financial services companies, emerging business enterprises
and individual entrepreneurs.
The lawyers who founded the firm in 1998 did so with a commitment to
excellence, integrity and creativity. Its strong reputation among
clients, adversaries and the judiciary is not inherited from prior
generations. Instead, the firm has earned its reputation day-by-day,
client-by-client and matter-by-matter. The firm's approach to the
practice of law is business-oriented and pragmatic.
About Berger & Montague, P.C.
Berger & Montague, P.C., based in Philadelphia, PA, consists of over 60
attorneys who represent plaintiffs in complex and class action
litigation. The firm has played lead roles in major cases for over 40
years resulting in recoveries of over $22 billion for their clients and
the classes they represent. On the Web: www.bergermontague.com.
If you wish to discuss this action or have any questions concerning this
press release, or your rights or interests with respect to this matter,
please contact: Andrew J. Entwistle, Esq. (email@example.com)
of Entwistle & Cappucci LLP, 280 Park Avenue, 26th Floor West, New York,
NY 10017, Telephone: (212) 894-7200; or Merrill G. Davidoff, Esq. (firstname.lastname@example.org)
or Michael Dell' (News - Alert)Angelo, Esq. (email@example.com)
of Berger & Montague, P.C., 1622 Locust Street, Philadelphia, PA 19103,
Telephone: (215) 875-3000.
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