lawsuit was initiated by Blue Flame, which filed a complaint against Chain Bridge on June 12
- Date
- 2021-05-07
Summary
Exhibit 95, filed May 7, 2021 as Document 131-30 in Blue Flame Medical LLC v. Chain Bridge Bank, NA. et al., No. 1:20-cv-00658 (E.D. Va.). It is a December 28, 2020 letter from WilmerHale on behalf of JPMorgan Chase Bank, N.A. to the General Counsel of the California State Treasurer's Office, titled a reservation of rights regarding the March 26, 2020 wire transfer to Blue Flame Medical LLC. The letter states that the Treasurer's Office initiated a $456,888,600 wire for personal protective equipment, that JPMC delivered it to Chain Bridge Bank and later recalled it, and that Chain Bridge filed a third-party complaint against JPMC on October 13, 2020. It reserves JPMC's rights, including indemnification, against the State of California if JPMC is held liable. The three-page exhibit is stamped JPMC-00000533 and JPMC-00000534.
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Full text
Case 1:20-cv-00658-LMB-IDD Document 131-30 Filed 05/07/21 Page 1 of 3 PageID#
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EXHIBIT 95
JPMC-00000533
Case 1:20-cv-00658-LMB-IDD Document 131-30 Filed 05/07/21 Page 2 of 3 PageID#
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WILMERHALE
December 28, 2020 Alan E. Schoenfeld
+1 212 937 7294 (!)
By Email +1 212 230 8888 (I)
alan.schoenfeld@wilmerhale.com
Spencer Walker
General Counsel
California State Treasurer's Office
915 Capitol Mall, Room 110
Sacramento, CA 95814
swalker@treasurer.ca.gov
Re: Reservation of Rights Regarding March 26, 2020 Wire Transfer to Blue Flame
Medical LLC
Dear Mr. Walker,
I am writing on behalf of JPMorgan Chase Bank, N.A. ("JPMC") regarding the
$456,888,600 wire transfer that the California State Treasurer's Office ("STO") initiated on
March 26, 2020.
On that date, the STO initiated the wire transfer to make payment to Blue Flame Medical
LLC ("Blue Flame") for personal protective equipment to facilitate the State of California's
response to the COVID-19 pandemic. JPMC confirmed with STO personnel that the wire was
authorized and in fact intended for Blue Flame, and delivered the wire to Chain Bridge Bank,
N.A. ("Chain Bridge"), Blue Flame's bank in Virginia. Despite having initiated and validated
the wire, however, the STO then decided that the wire should be recalled; after consultation with
Chain Bridge, JPMC successfully recalled the funds in full.
In a subsequent hearing before the California State Assembly, California State Treasurer
Fiona Ma stated just that-the STO "clawed the money back pending further confirmation of the
legitimacy of the payment[]" after both JPMC and Chain Bridge raised concerns about the
transaction. 1 The STO, as you may know, has expressed its sincere gratitude to JPMC for the
bank's efforts in this regard.
As a result of this recall, however, JPMC has been named as a third-party defendant in
Blue Flame Medical LLC v. Chain Bridge Bank, NA. et al., No. 1:20-cv-00658 (E.D. Va.). The
State Contracting in Emergency: The Wild, Wild West: PPE in the COVID-19 Crisis, Before the California
State Assembly Accountability and Administrative Review Committee (May 11, 2020) (statement of Treasurer Fiona
Ma); accord Treasurer Fiona Ma Statement on the Oversight Hearing Accountability and Administrative Review
Committee 4 (May 11, 2020) (same); see also Laurel Rosenhall, Afask vendor sues bank over thwarted deal with
California, CalMatters (June 12, 2020) (" [S]tate Treasurer Fiona Ma said that she asked for the state's money to be
returned after executives from two banks involved in the [Blue Flame] wire transfer" raised concerns about the
transaction.).
Wilmer Cutler I Iale and Dorr LLP, 7 World Trade Center, 250 Greenwich Street, New York, New York I 0007
BeiJing Berlin Boston Brussels Denver Frankfurt London Los Angeles New York Palo Alto San Francisco Washington
JPMC-00000533
JPMC-00000533
Case 1:20-cv-00658-LMB-IDD Document 131-30 Filed 05/07/21 Page 3 of 3 PageID#
2286
WILMER.HALE
Spencer Walker
December 28, 2020
Page 2
lawsuit was initiated by Blue Flame, which filed a complaint against Chain Bridge on June 12,
2020, seeking money damages for injuries that Blue Flame alleges it incurred following the
wire's recall, in addition to interest, costs, and attorneys' fees. Four months later, on October 13,
2020, Chain Bridge filed a third-party complaint against JPMC, seeking indemnification from
JPMC for any loss that Chain Bridge and its officers might incur as a result of the wire's recall.
JPMC has filed its answer to the third-party complaint, and the case is pending. 2
JPMC has retained Wilmer Cutler Pickering Hale and Dorr LLP in connection with the
Blue Flame lawsuit and intends to vigorously defend its rights. However, in the event JPMC is
ultimately held liable to Chain Bridge for any amount, JPMC reserves any and all rights,
remedies, and causes of action against the State of California, the STO, and any other California
agencies and/or employees, arising from the $456,888,600 wire to Blue Flame, its subsequent
recall, and resulting litigation, including the right to seek statutory, contractual, and/or equitable
indemnification from the State (or any California State entity or personnel) for any loss,
including attorneys' fees, JPMC incurs in connection with the Blue Flame lawsuit.
Very truly yours,
Isl Alan E. Schoenfeld
Alan E. Schoenfeld
Enclosures
cc: Cara M. Porter
Sarah L. Fabian
Deputy Attorneys General
State of California Department of Justice
Cara.Porter@doj.ca.gov
Sarah.Fabian@doj.ca.gov
2
Copies of Blue Flame's complaint (0kt. I), Chain Bridge's third-party complaint (0kt. 43), and JPMC's
answer to the third-party complaint (0kt. 64) are enclosed for your reference.
JPMC-00000534
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- gov.uscourts.vaed.477405.131.30.pdf
- Size
- 788,133 bytes
- SHA-256
- a622e1a74d5f068db59860fedecc22a2af094575c9ec5c2e68e9a8fb128cab0a
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