Funds Sue JPMorgan, WaMu Over Securities Deal

Law360, New York (July 7, 2010, 6:18 PM EDT) -- Black Horse Capital LP, Lonestar Partners LP and a posse of other investment funds have filed a lawsuit seeking to stop some of their $1 billion securities holdings in bankrupt Washington Mutual Inc. from being transferred to its new owner, JPMorgan Chase Bank NA.

The adversary complaint, filed Tuesday in the U.S. Bankruptcy Court for the District of Delaware, claims that the funds' preferred securities belong to third-party investors — not to the Chapter 11 estate of WaMu — and that the conditional agreement to exchange...
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