JPMorgan Chase & Co (JPM.N) could be liable to women who accused Jeffrey Epstein of sexual abuse if they can show that former executive Jes Staley had first-hand knowledge that the financier ran a sex-trafficking venture, a U.S. judge said on Monday.
U.S. District Judge Jed Rakoff in Manhattan discussed Staley’s alleged role, which Staley denies, in a decision explaining why he refused to dismiss lawsuits accusing JPMorgan and Deutsche Bank AG (DBKGn.DE) of enabling Epstein’s sex trafficking.
“If the allegations in plaintiffs’ complaints are taken as true, Mr. Staley had actual first-hand knowledge that Epstein conducted a sex-trafficking venture,” Rakoff wrote.
By attributing that knowledge to JPMorgan, Epstein’s accusers might show that JPMorgan “actually knew” about the venture or “recklessly disregarded” its existence, Rakoff said.
JPMorgan and lawyers for Staley did not immediately respond to requests for comment.
The decision covers two lawsuits against the banks by Epstein’s accusers, and a lawsuit against JPMorgan by the U.S. Virgin Islands, where Epstein allegedly abused women on his private island Little St. James.
Rakoff had issued his “bottom-line” rulings in those lawsuits on March 20.
JPMorgan is separately suing Staley to cover its losses in the two lawsuits it faces, and forfeit eight years of pay.
Staley has asked Rakoff to dismiss the bank’s case, accusing JPMorgan of using him as a “public relations shield” to deflect blame for its own failures in working with Epstein.
The U.S. Virgin Islands case included accusations that Epstein and Staley swapped sexually suggestive messages about young women, including an email that Rakoff quoted where Staley said: “That was fun. Say hi to Snow White.”
Staley, 66, led JPMorgan’s asset management business from 2001 to 2009, and its corporate and investment bank from 2009 to 2013. He later spent six years as Barclays Plc’s (BARC.L) chief executive.
All of the lawsuits are scheduled for trial this year.
The cases in the U.S. District Court, Southern District of New York are: Jane Doe 1 v Deutsche Bank AG et al, No. 22-10018; Jane Doe 1 v JPMorgan Chase & Co, No. 22-10019; Government of the U.S. Virgin Islands v JPMorgan Chase Bank NA, No. 22-10904; and JPMorgan Chase Bank NA v Staley, in Nos. 22-10019 and 22-10904.