by Matthew Russell Lee, Patreon Book Substack
SDNY COURTHOUSE, Feb 17 – The Federal Reserve - both the Board of Governors in Washington and the FRBNY - have been sued by Banco San Juan International for the terminal of its master account(s).
On the motion to dismiss, oral arguments were held on December 12 before U.S. District Court for the Southern District of New York Judge John G. Koeltl. Inner City Press was there. Thread:
Fed's lawyers from Simpson Thacher law firm cite Custodia (crypto) case. Does this outside counsel rep raise conflicts of interest on mergers?
Note: Simpson Thacher represents many banks applying to the Fed for merger approvals - why did the Fed, which has many in house lawyers, have to hire them? And isn't there now a conflict of interest on the merger applications? Fed: The Reserve Banks are not govt
Plaintiff: The Fed never closed the master accounts of Deutsche Bank, despite wrongdoing - and what about "Toronto Dominion, which pled guilty to money laundering"?
[Note: TD's Leonardo Ayala is being prosecuted in the District of NJ]
On January 8, 2025 Judge Koeltl dismissed the amended complaint, setting a time to further amend: "the defendants' motions to dismiss are granted. All of BSJI's claims are dismissed without prejudice as discussed above. At oral argument, counsel for BSJI indicated that BSJI may wish to file a second amended complaint. Tr. 16. The time to file a motion to amend, attaching a copy of the second amended complaint and explaining how the second amended complaint solves the deficiencies noted in this opinion, is January 27, 2025. The defendants may respond by February 10, 2025. The plaintiff may reply by February 17, 2025. If the plaintiff does not file any such motion by January 27, 2025, the Court will issue an order directing that judgment be entered dismissing the Amended Complaint."
On February 17 BSJI through counsel Abbe Lowell wrote in citing Fed Chair Jerome Powell's recent testimony that he is (belatedly) troubled by de-banking by the Reserve Banks. Full letter on Patreon here
Inner City Press will stay on these cases.
This case is Banco San Juan Internacional, Inc. v. The Federal Reserve Bank of New York, et al., 1:23-cv-06414 (Koeltl)
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