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Judge Reverses Dismissal of Chase Securities Suit

The legal battle between ""JPMorgan Chase"":http://www.jpmorganchase.com/corporate/Home/home.htm and Belgian-French bank ""Dexia SA"":http://www.dexia.com/EN/Pages/default.aspx is back on following the reversal of a decision to throw out much of the case.


U.S. District Judge Jed Rakoff went back on a previous decision to dismiss most of Dexia's claims against JPMorgan in a $774 million suit. According to a report from ""Reuters"":http://www.reuters.com/article/2013/05/18/us-jpmorgan-dexia-lawsuit-idUSBRE94G0TX20130518, the leftover claims amounted to about $5.7 million.

In reversing his decision, Rakoff noted that he didn't have the jurisdiction to grant a dismissal in the first place, citing an appeals court decision in a similar case involving American International Group (AIG) and Bank of America.

Dexia originally brought suit against JPMorgan in January 2012, alleging it was fraudulently convinced to purchase more than $1.6 billion of residential mortgage-backed securities that went bad. The company claims quality was misrepresented on 65 MBS purchased between 2005 and 2007 from JPMorgan, Bear Stearns, and Washington Mutual.

About Author: Tory Barringer

Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington's student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News' sister publication, MReport, which focuses on mortgage banking news.

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