State Treasurer Ted Wheeler and Oregon Attorney General Ellen Rosenblum announced that Oregon has helped to secure a $150 million settlement in a class action lawsuit filed against JPMorgan Chase & Co. to compensate investors for a financial scheme uncovered in 2012.
The so-called “London Whale” trading scandal impaired investors’ holdings including those of the Oregon Common School Fund and also the Oregon Public Employees Retirement Fund, which was appointed to be a lead plaintiff in the lawsuit along with public pension funds in Ohio and Arkansas.
“Financial firms need to play by the rules and, if they don’t, Oregon will take a stand on behalf of taxpayers, schools, communities and retired public employees,” said Treasurer Wheeler, who is a member of the Oregon Investment Council, which sets state investment policy. “This settlement will do more than repay investors: It also sends a clear message that Oregon will continue to hold corporations accountable.”
The share of the settlement due to the Oregon pension fund and common school fund has not yet been determined. The settlement class includes all persons who purchased JP Morgan common stock between April 13, 2012 and May 21, 2012. Thousands of individual Oregonian investors also are potential members of the class.
The suit, filed in July 2012, alleged that JPMorgan Chase issued false and misleading statements regarding its trading activity, describing risky and speculative trading strategies merely as “hedges” and “risk management” devices. The trading losses incurred by JPMorgan Chase caused the bank’s stock value to nosedive, causing substantial harm to investors.
The losses to Oregon public funds are estimated to be between $846,192 and $1 million, depending when stock values are computed.
The case was filed in the U.S. District Court for the Southern District of New York. All identified class members will be notified of their status by a claims administrator appointed by the court, and will receive additional information about filing a claim.
The Oregon State Treasury protects public assets and saves Oregonians money through its investment, banking, and debt management functions. State investment policies are set by the Oregon Investment Council. The State Treasury also promotes public outreach and education to help Oregonians learn strategies to save money, invest for college and make smart financial choices.