WILMINGTON, Del. (AP) — A Delaware bankruptcy judge is resuming a hearing to consider approval of bank holding company Washington Mutual Inc.’s reorganization plan.
The hearing began Wednesday and was to resume Friday with attorneys for shareholders opposing the plan expected to question the conduct of hedge funds supporting the plan.
Washington Mutual’s reorganization plan is based on the settlement of lawsuits pitting Washington Mutual, the Federal Deposit Insurance Corp. and JPMorgan against one another. The lawsuits were filed after the FDIC seized WaMu’s flagship bank in 2008 and sold its assets to JPMorgan in the largest bank failure in U.S. history.
The shareholders have accused the hedge funds of dominating negotiations with JPMorgan for their own gain and using inside information from the bankruptcy to trade in Washington Mutual securities.