Jp Morgan Chase Bank V. Madoff Case

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Introduction Bernard L. Madoff was the perpetrator of a Ponzi scheme, and he was finally arrested in December 2008. MLSMK Investment Company (MLSMK) is a Florida partnership, which invested $12.8 million in Madoff's investment company between October and December 2008. On April 23, 2009, MLSMK filed a complaint in the District Court asserting five claims against JP Morgan Chase & Co. (JPMC) and JP Morgan Chase Bank (Chase Bank). They were accused of conspiring with Madoff to trick the victims. Facts Bernard L. Madoff Investment Securities (BMIS) provided market-making services, investment-advisory services, and proprietary trading for clients. Madoff encouraged their clients to invest in its investment-advisory entity, promising the investors they would earn returns up to 10-12% a year. However, Madoff used later-invested money from the investment-advisory entity to pay the returns which he promised to other investors. On December 11, 2008, Madoff was …show more content…

v. One Groupe Int'l Inc. The plaintiffs in this case alleged that the defendant’s aiding and abetting of another's securities law violations, so the plaintiffs asserted a RICO claim. The defendant moved to dismiss the RICO claim. Then, the district court interpreted that the RICO Amendment will only bar RICO claims that the plaintiffs could pursue as securities claims against the named defendant with predicate acts of securities fraud. In addition, there is another relevant question under PSLRA was pointed out in the OSRecovery case that whether the alleged conduct of specific defendant is actionable or not under the securities laws. Due to the reason that under Section 10(b) of the Securities Exchange Act, "there is no private right of action for aiding and abetting”. And the plaintiffs could not pursue to prove their rights by filing a securities claim. The court concluded that the RICO Amendment does not bar the plaintiff’ RICO

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