JPMorgan Challenges $115M Legal Bill for Fraud Convicts

JPMorgan's Stance on Legal Fees for Convicted Fraudsters

For nearly three years now, JPMorgan Chase has been covering the legal expenses for Charlie Javice and Olivier Amar, the duo behind the fraudulent sale of their financial aid startup, Frank, to the banking titan.

Exorbitant Legal Costs Under Scrutiny

However, the legal fees have ballooned to an astonishing $115 million, a figure that JPMorgan claims far exceeds any reasonable costs associated with their defense. In a court filing submitted late Friday, the bank contended that it should not be liable for such excessive expenses and argued that its obligation to cover these costs, a condition included in the acquisition deal, should come to an end.

Legal Fees Breakdown

The filing reveals that Javice's legal team, comprising five law firms, has billed approximately $60.1 million in fees and expenses. Meanwhile, Amar's legal representation has accumulated around $55.2 million in fees. This brings the total legal fees for both convicts to $115 million, with one particular law firm receiving a staggering $35.6 million in reimbursements alone.

Comparative Legal Expenses

For context, former Theranos CEO Elizabeth Holmes, who faced similar legal challenges after being convicted of defrauding investors, reportedly incurred legal fees of about $30 million. This stark comparison raises questions about the reasonableness of the amounts being claimed by Javice and Amar.

JPMorgan's Position on Abusive Billing

In its filing, JPMorgan expressed concerns that the bank would suffer “irreparable injury” if the court fails to intervene against what it describes as “abusive billing” practices. The bank criticized Javice and her legal team for treating the litigation process “like a blank check.”

Background on Convictions

In March, 33-year-old Javice was convicted of deceiving JPMorgan during the acquisition of her company, Frank, in the summer of 2021. She forged records to falsely indicate that Frank had over 4 million customers, while the actual number was less than 300,000. Amar faced similar charges and was convicted alongside her.

Legal Precedents and Obligations

At the onset of the case, a Delaware court determined that JPMorgan was required to cover Javice and Amar's legal fees, a stipulation that was part of the original agreement during the acquisition in 2021. This ruling has now become a point of contention as the bank seeks to limit its financial exposure.

Representation and Responses

Among Javice's legal counsel is Alex Spiro from Quinn Emanuel, a high-profile attorney known for representing figures like Elon Musk. As of now, Spiro has not responded to requests for comments regarding the case. Similarly, a law firm representing Amar has yet to provide feedback.

Bank's Public Statements

Pablo Rodriguez, a spokesperson for JPMorgan, stated, “The legal fees sought by Charlie Javice and Olivier Amar are patently excessive and egregious. We look forward to sharing details of this abuse with the court in the coming weeks.”

This article originally appeared on Fortune.com.