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Judge Orders $55 Million Held 20 second(s) ago Bloomberg Jan 29 2009 12:51:05
By Steven Church
Jan. 29 (Bloomberg) -- Washington Mutual Inc., the former parent of the biggest U.S. bank to fail, must deposit a $55 million federal government payment into a court-controlled account, the judge overseeing the company’s bankruptcy said. U.S. Bankruptcy Judge Mary F. Walrath in Delaware said today the money should be held by the court until the question of whether WaMu, as the company is known, is entitled to it. JPMorgan Chase & Co. said in court today that it owns at least
part of the $55 million because it bought WaMu’s bank and other assets for $1.9 billion last year. “I’ve heard conflicting claims to the money and I’m going
to order that the money be paid to the registry,” Walrath said, referring in a hearing to the entity that will hold the cash. Since filing for bankruptcy in September, Seattle-based WaMu has tried to get control of more $4.4 billion held in accounts taken over by JPMorgan when the Wall Street firm bought WaMu’s assets. The $55 million is related to a decades-old court case that WaMu won against the U.S. government.
The $4.4 billion may be claimed by rival groups of
bondholders and the U.S. Federal Deposit Insurance Corp., according to court records and testimony. Walrath has put off a decision on Wamu’s request to force JPMorgan to return the $4.4 billion.
Walrath also ordered JPMorgan to file a claim within 60
days outlining how much money, if any, it believes Wamu owes it. She rejected JPMorgan’s request that it be given until July to file a claim.
