Court rejects JPMorgan's Bank One settlement

JPMorgan Chase & Co., the largest U.S. bank by market value, failed to win court approval of a proposed settlement of three shareholder lawsuits that claimed JPMorgan paid too much for Bank One Corp.

JPMorgan paid $55.1 billion for Chicago-based Bank One in 2004. Complaints filed following the purchase alleged the lender paid a $7 billion premium so former JPMorgan Chairman William Harrison could lead the combined firms.

March 3, U.S. District Judge David H. Coar in Chicago rejected the accord, which required the bank to allow more scrutiny of transactions requiring shareholder approval for as long as four years. JPMorgan would have paid no money to the claimants and admitted no fault.

"As murky as the value of the plaintiffs' claims is, the benefits of the settlement are even murkier," Coar said. The judge said he shared an objecting shareholder's concern that the reforms might not last.

Neither JPMorgan spokesman Tom Kelly nor plaintiffs' attorney Jeffrey Smith of New York-based Wolf Haldenstein Adler Freeman & Herz LLP returned calls seeking comment.

The case is In Re JPMorgan Chase & Co. Securities Litigation, MDL 1783, U.S. District Court, Northern District of Illinois (Chicago).