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HomeNewsArchivesCHASE: VICB FAILED TO MEET AUGUST DEADLINE

CHASE: VICB FAILED TO MEET AUGUST DEADLINE

Oct. 5, 2001 — JPMorgan Chase officials denied on Friday the allegations made in a lawsuit filed by Virgin Islands Community Bank owner Jeffrey Prosser the day before concerning a failed deal that would have seen Prosser taking over Chase’s local assets.
VICB’s $50 million lawsuit, filed Thursday in U.S. District Court on St. Croix, claimed that Chase acted fraudulently and misrepresented itself during the three-year negotiating period. VICB officials said that the deal between the two banks was dead.
In a statement issued Friday in New York, officials of JPMorgan Chase, the bank's parent company, said that while they had not seen the VICB lawsuit, "Chase strongly objects to each and every allegation as reported in the press."
Chase meanwhile confirmed that it had filed its own lawsuit "weeks ago" against VICB, Prosser and his company Innovative Communication Corp. for "failure to close on the proposed transactions."
When contacted, Chase spokeswoman Kristen Batteria said she could not elaborate on the statement. The Source obtained an unsigned copy of the Chase suit against VICB, which said that the parties had agreed last April to close the deal on Aug. 3.
The Chase suit alleges that a VICB official told a Chase official on July 20 that VICB "did not have the financial ability to meet their obligations at closing as required by the agreements."
Because of that alleged breach of contract, Chase is seeking not less than $3.5 million in damages.
Michael Dow, VICB president, said that as of Friday night he had not seen the Chase lawsuit.
"I’ve not heard anything about it, let alone been served. And I am the agent of service," Dow said.
While Dow declined to comment on the suit because he had not seen it, he did say that VICB had been reluctant to move forward in July, because of a pending class-action lawsuit against Chase. VICB claims that the lawsuit wasn’t properly disclosed during negotiations and therefore affected the value of the deal.
As for Prosser’s financial wherewithal, Dow said "we were ready and able with all the financial arrangements in place to close."
According to individuals familiar with the deal, local Chase employees were told in July that the bank branches would close on Aug. 3 for a long weekend and then reopen on Aug. 7 as VICB branches. That did not happen.
While VICB is a separate company from ICC, it is believed that Prosser may be financially strapped because ICC, which has borrowed heavily, is suffering from cash-flow problems. That information is according to several local contractors and vendors who are awaiting payment for services, and who asked not to be identified.
ICC also is the defendant in a number of lawsuits seeking payment for goods provided or services rendered, including a $5 million claim by Sony.

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Oct. 5, 2001 -- JPMorgan Chase officials denied on Friday the allegations made in a lawsuit filed by Virgin Islands Community Bank owner Jeffrey Prosser the day before concerning a failed deal that would have seen Prosser taking over Chase’s local assets.
VICB’s $50 million lawsuit, filed Thursday in U.S. District Court on St. Croix, claimed that Chase acted fraudulently and misrepresented itself during the three-year negotiating period. VICB officials said that the deal between the two banks was dead.
In a statement issued Friday in New York, officials of JPMorgan Chase, the bank's parent company, said that while they had not seen the VICB lawsuit, "Chase strongly objects to each and every allegation as reported in the press."
Chase meanwhile confirmed that it had filed its own lawsuit "weeks ago" against VICB, Prosser and his company Innovative Communication Corp. for "failure to close on the proposed transactions."
When contacted, Chase spokeswoman Kristen Batteria said she could not elaborate on the statement. The Source obtained an unsigned copy of the Chase suit against VICB, which said that the parties had agreed last April to close the deal on Aug. 3.
The Chase suit alleges that a VICB official told a Chase official on July 20 that VICB "did not have the financial ability to meet their obligations at closing as required by the agreements."
Because of that alleged breach of contract, Chase is seeking not less than $3.5 million in damages.
Michael Dow, VICB president, said that as of Friday night he had not seen the Chase lawsuit.
"I’ve not heard anything about it, let alone been served. And I am the agent of service," Dow said.
While Dow declined to comment on the suit because he had not seen it, he did say that VICB had been reluctant to move forward in July, because of a pending class-action lawsuit against Chase. VICB claims that the lawsuit wasn’t properly disclosed during negotiations and therefore affected the value of the deal.
As for Prosser’s financial wherewithal, Dow said "we were ready and able with all the financial arrangements in place to close."
According to individuals familiar with the deal, local Chase employees were told in July that the bank branches would close on Aug. 3 for a long weekend and then reopen on Aug. 7 as VICB branches. That did not happen.
While VICB is a separate company from ICC, it is believed that Prosser may be financially strapped because ICC, which has borrowed heavily, is suffering from cash-flow problems. That information is according to several local contractors and vendors who are awaiting payment for services, and who asked not to be identified.
ICC also is the defendant in a number of lawsuits seeking payment for goods provided or services rendered, including a $5 million claim by Sony.