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By Matthew Russell Lee, Patreon Maxwell book

SDNY COURTHOUSE, May 26 – J.P. Morgan Chase and Deutsche Bank were sued for their enabling of Jeffrey Epstein, in lawsuits filed on Thanksgiving 2022 in the U.S. District Court for the Southern District of New York, where Inner City Press found them in the docket.

  Late on May 17, 2023, plaintiffs' lawyer David Boies selectively announced a $75 million settlement with Deutsche Bank. Nothing was filed in the docket. But the pressure on JPM Chase, and its CEO Dimon, grew.

More including class analysis on Substack here

On May 26, Judge Rakoff held oral arguments on class certification. Inner City Press was there, thread here:

All rise!

Judge Rakoff: We're here on the question of class certification... I just got off the phone about a deposition taking place in the same case. You're missing all the fun, folks. (Laughs). Let's first consider Jane Doe's expert...

 Judge Rakoff: The expert writes, "Class certification is appropriate here" - but isn't that a legal conclusion?

Counsel to Jane Doe: Maybe it's a matter of drafting...

Judge Rakoff: I strike that first opinion.

 Counsel to Jane Doe: She is saying that Epstein could only run his sex trafficking conspiracy by having access to influential people. Judge: Duh. What's her expertise? Counsel to Jane Doe: She was at DOJ and interviewed a number of victims

Counsel to Jane Doe: Her experience does not have to be into JPMorgan Chase Bank -- Judge Rakoff: So what is it were Signature Bank?  Counsel to Jane Doe: She looked into banks while at DOJ. [Note: the expert at issue is Jane Khodarkovsky formerly of DOJ]

 JPMC's lawyer: She was 3 1/2 years at DOJ, not in sex trafficking, only money laundering. So she's not an expert.

Judge Rakoff: After 3 1/2 years at DOJ, maybe an expert in bureaucracy... JPMC's lawyer: We say, the issue of sex trafficking is not for class action

Judge Rakoff: The allegations is that Jeffrey Epstein enticed them into sexual acts by getting massages... I don't see why you need to be an expert to see that if the allegations are true, they may will violate the sex trafficking statute

Judge Rakoff: And that if the money to carry it out came from or through a bank that should have known, it may be liable - why is an expert needed on this?

JPM Chase lawyer: The question is, what are the indices of sex trafficking?

Judge: This is not a clean slate

 Judge Rakoff: The grand jury that issued the 2019 indictment found Jeffrey Epstein sexually exploited and abused dozens of minor girls at his various homes. I don't know what the expert's opinion adds to this. Chase lawyer: It's not susceptible to class treatment

 Judge Rakoff: We could have used a psychological expert, as was included in the case before Judge Nathan

JPMC lawyer: Their expert just parrots others' info.  Judge: To your adversary: If you had a frozen pipe, a plumber could opine... But aren't money laundering regulations laws, & the Court the expert? Doe's lawyer: She is an expert on how trafficking is financed

 Doe's lawyer: She example, she has expertise in the filing or not filing of Suspicious Activities Reports. Judge Rakoff: Are you saying an expert is needed because I have been asleep for the 99 cases on the topic of SARs? Let's turn to class certification...

Judge Rakoff: JPM Chase does not dispute that Mr. Epstein was involved in a longstanding sex trafficking venture that impacted dozens that required money to make it work.  JPMC's lawyer: We're not sure it's dozens- Judge Rakoff: Dozens is what the indictment says

 Doe's lawyer: This class should be certified - it was sexual exploitation and the commonality here is the bank. Epstein needed these obscene amounts of money from JPM Chase to continue with this. I may need a sidebar on this. Judge: About the SARs?

 [Sidebar is held; transcript to be sealed, Judge says]

Judge Rakoff: I have taught the class action seminar at NYU Law School, so I think I know the elements. Thank you, I will get you an order afterword. I'll get called at 5 on the Dimon deposition...

More on Substack here.

On May 19, Jes Staley's lawyer argued before Judge Jed S. Rakoff to dismiss JPM Chase's claim against him; Chase opposed. Inner City Press was there, live tweeted thread here and below.

On May 24, Judge Rakoff denied Staley's motions: "ORDER denying [90] Motion to Dismiss. On April 24, 2023, third-party defendant James ("Jes") Staley moved to dismiss the third-party complaint filed by defendant/third-party plaintiff JPMorgan Chase Bank, N.A. against him in each of the above-captioned cases. After full consideration of the parties' written submissions and oral arguments, the Court hereby denies Mr. Staley's motion in full. An opinion explaining the reasoning behind this ruling will follow in due course. The Clerk is respectfully directed to close entry number 90 on the docket of Jane Doe v. JP Morgan Chase Bank, N.A., 22-cv-10019, and entry number 125 on the docket of Government of the United States Virgin Islands v. JP Morgan Chase Bank, N.A., 22-cv-10904. SO ORDERED. (Signed by Judge Jed S. Rakoff on 5/24/2023)."

From May 19: Staley's lawyer: It's striking that JPM Chase is saying, We're not reponsible but if we are. It's Staley. Indemnification does not apply here - JPMC did things beyond what Staley did.

Staley's lawyer: This alleged vouching by Mr Staley would have been to JPMC's employees. The doesn't identify the harm supposedly caused by Mr Staley to Jane Doe, much less the USVI. Judge Rakoff: I have to limit you to 20 minute, I have a 4 pm [criminal] matter

JPM's lawyer: Doe alleges sexual assault by Staley. But if Staley had done his job, Epstein would not have been a JPM Chase client. We cannot indemnify Staley for criminal acts.

JPM's lawyer: The Madoff case supports us. And it is Congress' purpose to punish traffickers. The question at bar must be answered in our favor.

Staley's lawyer: Bylaws are contractual in nature, the Delaware courts have found, contrary to JPMorgan's argument. Judge Rakoff: They argue they weren't contractually giving up their right to sue you for indemnification.

Staley's lawyer:  Cases don't say that

 Staley's lawyer: If they have to re-plead, they should make things clear.

Judge Rakoff: So you know what you're facing. JPM Chase's lawyer Leonard Gail: Let's spend real time on Madoff. Madoff says contribution can be implied. Its language was shorthand- and dicta

JPM's lawyer: The TVPA should not be read to help traffickers. Restatement of Torts, Section 23 - Congress was legislating against it.

 Judge Rakoff: I agree Congressional silence is not a basis for reaching a definitive conclusion. They are talkative.. I am joking

 JPM's lawyer: Even if there was no contribution, supplemental jurisdiction, they can stay in - they have already been present at depositions. It's judicial economy. Judge Rakoff: I've heard what I need.

Judge Rakoff: I'll get you at least a bottom line opinion by the end of this month. Mr Staley should know by May 31. Anything else? No? If you would clear out, I have a 4 pm matter.

More on Substack here.

   The JPM Chase complaint is on Patreon, here.

On March 20, 2023 Judge Jed S. Rakoff in a bottom line order dismissed some but not all claims, in the Epstein-related cases against JPMC and Deutsche Bank.

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