March 22, 2009

WaMu holding company sues FDIC

The holding company for Washington Mutual Inc. has sued the Federal Deposit Insurance Corp. for allegedly denying claims against the firm's former banking unit.

The Seattle Times reported Sunday that the lawsuit was filed Friday in Washington. The federal lawsuit alleges that the FDIC improperly sold WaMu's banking assets to JPMorgan Chase for $1.9 billion.

The company claims federal regulators should have instead conducted a straight liquidation that could have produced more money for creditors, which included the holding company.

The federal Office of Thrift Supervision seized Washington Mutual Bank in September and turned it over to the FDIC, which sold the company's assets and most of its liabilities to Chase.

The newspaper noted that the lawsuit is one of the first legal actions to challenge the FDIC's authority over seized banking assets. The lawsuit's outcome would not affect WaMu's deal with Chase, the Times said.