The U.S. Department of Justice's ongoing settlement talks with JPMorgan Chase & Co. over faulty mortgage-backed securities have been productive and will be resolved "soon," one way or another, Attorney General Eric Holder Jr. said today.
Amid recent reports that the government's tentative $13 billion deal was teetering on collapse, Holder didn't provide any greater light on the terms of the deal or what the talks with the bank are focusing on.
In his first public statement about the deal, Holder, responding to a reporter's question about the settlement talks, said a deal would be reached "soon." He didn't indicate when.
"That's still an operative phrase," Holder said. "The associate attorney general, Tony West, has been leading our side in connection with these conversations. They are ongoing. I think they have been productive."
"I won't get into the nature of what we have been talking about, other than to say that I expect that one way or another we will resolve this 'soon,'" Holder said. "We will either have an agreement or we will be filing a lawsuit."
West added: "We're not in a position to announce anything today."
JPM's deal could open up other liabilities, as The National Law Journal reported last month. One thorny issue: whether the bank or the Federal Deposit Insurance Corp. will assume liability over the faulty mortgage-backed securities of Washington Mutual.
Holder also updated reporters on ongoing settlement talks in a major airlines antitrust case involving American Airlines and US Airways Group Inc., which is set for trial this month in Washington federal district court. The Justice Department’s Antitrust Division filed suit in August to block the deal.
Those talks include giving up some takeoff and landing slots at airports, Holder told reporters today.
"What we have tried to focus on is to make sure that any resolution in this case necessarily includes divestitures of facilities in key constrained airports throughout the United States," Holder said. "That for us is something that has to be a part of any resolution."
Holder's remarks touched on a range of issues, including the pending military case against Khalid Sheikh Mohammed. Holder, four years ago, pushed unsuccessfully to try Mohammed in federal district court in New York.
"I think what we have seen over these past four years, not to be egocentric about this, but I was right," Holder said. "I think that had we gone along the path that I announced at that time, we would not have had to close down half of Manhattan, it wouldn't have cost $200 million per year, and the defendants would be on death row as we speak."
"I think this is an example of when politics get into matters that ought to be simply decided by lawyers and national security experts," Holder said.