DETROIT (CN) – Harvard University claims JPMorgan Securities and the operators of Venture Holdings Co. defrauded it in the sale of $50 million in securities by hiding the insolvency of a German subsidiary of Venture, Peguform. Harvard and Regiment Capital Ltd. say they lost $1.4 million in their share of the $50 Million Senior Secured Term Loan C.
Also sued are Venture and Peguform president Michael Torakis of Grosse Point, who Harvard says “actively participated in the misrepresentations”; Venture CFO James E. Butler Jr. of Grosse Pointe Park; and Venture CEO Larry Winget of Leonard, Mich.
JP Morgan is sued as successor to Banc One, which arranged the syndication of the $50 million note.
Harvard’s lawsuit in Wayne County Court cites this excerpt from a June 3, 2002 news article from Standard & Poor’s: “If the Company [apparently Bank One] did not inform the investors about the loss of Peguform’s line of credit and the inevitable consequences, this represented an overwhelming misrepresentation and could spark a slew of lawsuits.”
Harvard and Regiment are represented by Joseph Grenn of Dearborn, Mich.