JPMorgan Chase Paid $384 Million to Resolve Dispute with Asset Firm: Report
Kline, Alan, American Banker
Byline: Alan Kline
A Kansas City, Mo., asset management firm that until last summer was partially owned by JPMorgan Chase & Co. (JPM) quietly won a large breach-of-contract judgment last year against the New York bank, according to court documents unsealed this week.
The Kansas City Business Journal reported Thursday that an arbitration panel ordered JPMorgan Chase in August pay American Century Investments $373 million for violating a 2003 agreement to market certain American Century funds to its clients. The panel ruled that JPMorgan Chase investment advisors essentially ignored terms of that agreement and instead gave priority to the bank's funds.
JPMorgan Chase fought the ruling, but a judge upheld it in early December and the company paid a lump sum of $384 million, including interest, later that month, the Kansas City Business Journal reported.A The court records were unsealed at the newspaper's request.A
JPMorgan Chase sold its 41% stake in American Century in July to Canadian Imperial Bank of Commerce (CM) for $848 million. It had owned a stake in the company since 1998.
According to court documents, JPMorgan Chase became the sole owner of a joint venture between the two firms in 2003 and, under terms of that purchase, its sales team was expected to market American Century's products to customers. …