(Updates with claim in first paragraph.)
June 1 (Bloomberg) -- JPMorgan Chase & Co. and Lehman Brothers Holdings Inc. settled a dispute over $222.3 million in claims on the defunct firm that the second-biggest U.S. bank inherited when it bought Washington Mutual Bank after Lehman’s September 2008 bankruptcy.
The settlement was disclosed in a court filing today. Details weren’t given.
The WaMu claims stemmed from a swap agreement it had with Lehman’s special-financing unit, according to proofs of claim filed by JPMorgan. The New York-based bank paid itself back for what was owing by taking collateral deposited with it by Lehman, according to the claim documents. Lehman had objected that $80 million of the collateral was part of a guarantee agreement that JPMorgan wasn’t entitled to draw on.
The settlement doesn’t affect Lehman’s ongoing $8.6 billion lawsuit against JPMorgan. JPMorgan, Lehman’s main clearing bank in the 2008 credit crisis, is trying to get the suit dismissed.
The two companies are due to present their agreement on the WaMu claims to a Manhattan bankruptcy judge tomorrow.
The bankruptcy case is In re Lehman Brothers Holdings Inc., 08-13555, U.S. Bankruptcy Court, Southern District of New York (Manhattan). The adversary case is Lehman Brothers Holdings Inc. v. JPMorgan Chase Bank NA, 10-03266, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
--With assistance from Bill Rochelle in New York. Editors: John Pickering, Glenn Holdcraft
To contact the reporter on this story: Linda Sandler in New York at firstname.lastname@example.org
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