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Judge Slammed for Upending JPMorgan Jury Verdict

November 13, 2017

Legal experts have called into question allegations by a New York judge that a jury verdict to award damages to a fired JPMorgan wealth manager was “prejudiced,” Law360.com writes.

Last week U.S. District Judge Denise Cote upended a verdict that ordered JPMorgan to pay former employee Jennifer Sharkey $1.13 million. JPMorgan had fired Sharkey in 2009. But barely an hour after the jury reached its verdict, Cote said the jury was prejudiced, based on the fact that the $563,000 in emotional damages it awarded was the same amount that the jury had awarded the plaintiff in back pay. That suggested that the jury intended to award punitive damages to Sharkey, against Cote’s instructions, the judge explained. Judge Cote also called Sharkey a liar.

But Daniel Zahn, a Long Island malpractice lawyer, tells Law360.com that Cote “usurped the role of the jury.” Zahn also tells the legal news website that Cote’s comments were a “nightmare” for Sharkey after years of litigation.

Pace University law professor Bennett Gershman, meanwhile, tells Law360.com that federal judges do have wide latitude to express their opinions. Nonetheless, Gershman believes Cote went too far, and that calling the jury prejudiced was inappropriate, according to the legal news website. Legal ethics expert Howard Elman of Matalon Shweky Elman PPLC tells Law360.com that Cote’s statements were “somewhat gratuitous.”

Zahn also tells the legal news website that Cote should have disclosed her previous ties to Kaye Scholer LLP and to Curtis Mallet-Prevost Colt & Mosle LLP. Arnold & Porter Kaye Scholer LLP, a firm formed via merger, had represented JPMorgan against Sharkey, while Curtis Mallet-Prevost had represented a client involved in the case, according to Law360.com.

Gershman, however, tells the legal news website that suggesting any bias on Cote’s part would be “poor speculation” because she had worked at Kaye Scholer from 1985 to 1991 and at Curtis Mallet-Prevost in the 1970s.

Cote has not called for a new trial or a dismissal as of Wednesday, but had said that a new trial would be necessary if Sharkey and JPMorgan couldn’t settle, according to the legal news website. However, several settlement attempts have already failed, Law360.com writes.

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In a separate case, JPMorgan last week asked a judge to throw out an $8 billion jury verdict in a case involving the estate of a former American Airlines executive, Bloomberg writes.

In September, a probate court jury in Dallas had awarded $2 billion in punitive damages to the widow of Max Hopper, the Hopper estate and two of his children, according to the news service, which adds that it was the largest jury verdict so far in 2017. The suit had alleged that JPMorgan had mismanaged Hopper’s $19 million estate, Bloomberg writes. Hopper had died in 2010 without a will, and the suit alleges JPMorgan missed financial deadlines, ignored Hopper’s widow’s requests to sell stock and let stock options expire, according to the news service. Hopper’s two children have already asked that the award be reduced to around $74 million, although Hopper’s widow hasn’t made any comment on the award yet, Bloomberg writes.

But last week, JPMorgan said Hopper’s family doesn’t deserve any of the award and that the jury failed to do any “independent analysis” before awarding the $8 billion, according to a Thursday filing in Dallas probate court cited by the news service.

“The crux of the lawsuit is whether sparring survivors of a decedent may blame an independent administrator for seeking judicial guidance on a distribution issue about which the survivors disagree,” the firm said in the filing, according to Bloomberg.

By Alex Padalka
  • To read the Bloomberg article cited in this story, click here.
  • To read the Law360 article cited in this story, click here if you have a paid subscription.