Jes Staley, the former JPMorgan Chase executive who is being sued by the bank for allegedly failing to disclose his participation in Jeffrey Epstein’s sex crimes, must face trial alongside his former employer, a New York judge has ruled.
Staley on Monday lost his bid to have the claims by the bank separated from two lawsuits brought against JPMorgan by an alleged Epstein victim and the US Virgin Islands, where the late paedophile had a home.
JPMorgan’s claims against Staley were “closely related” to those made in the other civil lawsuits, Judge Jed Rakoff ruled, adding that Staley was a “key figure” in the complaints against the banks. Rakoff said the trio of complaints would be heard together in October as planned.
The suits against JPMorgan accuse the bank of benefiting from human trafficking by maintaining Epstein as a client for 15 years despite numerous internal warnings about his illegal behaviour.
Staley, who was for a period Epstein’s private banker at JPMorgan, was sued by the bank last month after lawyers for the lender said new details about the relationship between the two men had emerged during an interview with the alleged Epstein victim. They said the new details included allegations that the 66-year-old banker had sexually assaulted the woman in question.
The bank has branded the claims brought against it as “meritless” and asked the court to make its former executive liable for any damages that might be awarded against it. It is attempting to claw back tens of millions of dollars of Staley’s pay.
“The facts relating to [Staley] will therefore be a prominent focus of the trial of the underlying case,” Rakoff wrote on Monday, adding that it would make “no sense” to agree to Staley’s lawyers’ request to sever JPMorgan’s case against the executive from the two against the bank.
“None of Staley’s whines remotely warrants either a severance or a change in the joint trial date,” Rakoff wrote.
Lawyers for the Epstein victim suing JPMorgan had also argued for the cases to be separated. They said the bank’s countersuit against Staley was designed to “harass and intimidate” her, as her private medical records and intimate communications would now be shared with one of her alleged abusers.
The judge said the “proper way” to resolve such concerns was to keep the evidence gathered by lawyers confidential, as JPMorgan had already agreed.
A lawyer for the alleged Epstein victim did not immediately respond to a request for comment.
A lawyer for Staley declined to comment. The former banker, who left JPMorgan in 2013, is set to be questioned under oath by the bank’s lawyers later this month.
Rakoff did agree to extend a pre-trial procedural deadline by seven weeks after Staley’s lawyer had argued that his client would need more time to review tens of thousands of documents related to the case.
Monday’s decisions by the judge came after Staley broke his silence last week to say, via his lawyer, that the allegations against him were “baseless, but serious” and to accuse JPMorgan of slandering him.
After JPMorgan and a stint at a hedge fund, Staley became chief executive of the British bank Barclays in 2015. He resigned after six years following a regulatory investigation in the UK into the way he characterised his relationship with Epstein.
Separately on Monday, in a response to the complaint against the bank by the alleged Epstein victim, JPMorgan denied that longstanding chief executive Jamie Dimon knew of Staley’s “personal involvement” with Epstein.
In the new filing, the bank also denied that Dimon knew Epstein had been arrested for solicitation in Florida in 2006 or subsequently registered as a sex offender in the state. Dimon is set to be deposed in May.
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