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AlaFile E-Notice

To: DYLAN COOK BLACK

[email protected]

01-CV-2009-903641.00

NOTICE OF ELECTRONIC FILING

IN THE CIRCUIT COURT OF JEFFERSON COUNTY, ALABAMA

The following complaint was FILED on 11/13/2009 2:11:42 PM

JEFFERSON COUNTY, ALABAMA v. JPMORGAN SECURITIES, INC. ET AL

01-CV-2009-903641.00

Notice Date: 11/13/2009 2:11:42 PM

ANNE-MARIE ADAMS

CIRCUIT COURT CLERK

JEFFERSON COUNTY, ALABAMA

JEFFERSON COUNTY, ALABAMA

BIRMINGHAM, AL 35203

205-325-5355

[email protected]

State of Alabama

Unified Judicial System

Form ARCiv-93 Rev.5/99

COVER SHEETCIRCUIT COURT - CIVIL CASE

(Not For Domestic Relations Cases)

Case Number:

Date of Filing:

01-CV-2009-903641.00

11/13/2009

Judge Code:

GENERAL INFORMATION

IN THE CIRCUIT OF JEFFERSON COUNTY, ALABAMA

First Plaintiff:

JEFFERSON COUNTY, ALABAMA v. JPMORGAN SECURITIES, INC. ET AL

Business

Government

Individual

Other

BusinessFirst Defendant:

Government

Individual

Other

NATURE OF SUIT:

TORTS: PERSONAL INJURY

WDEA - Wrongful Death

TONG - Negligence: General

TOMV - Negligence: Motor Vehicle

TOMM - Malpractice-Medical

TOPL - Product Liability/AEMLD

TOWA - Wantonnes

TOLM - Malpractice-Legal

TOOM - Malpractice-Other

TBFM - Fraud/Bad Faith/Misrepresentation

TOXX - Other:

TORTS: PERSONAL INJURY

TOPE - Personal Property

TORE - Real Property

OTHER CIVIL FILINGS

ABAN - Abandoned Automobile

ACCT - Account & Nonmortgage

APAA - Administrative Agency Appeal

ADPA - Administrative Procedure Act

ANPS - Adults in Need of Protective Services

OTHER CIVIL FILINGS (cont'd)

MSXX -

CVRT - Civil Rights

COND - Condemnation/Eminent Domain/Right-of-Way

CTMP-Contempt of Court

CONT-Contract/Ejectment/Writ of Seizure

Birth/Death Certificate Modification/Bond Forfeiture Appeal/Enforcement of Agency Subpoena/Petition to Preserve

TOCN - Conversion

EQND- Equity Non-Damages Actions/Declaratory Judgment/Injunction Election Contest/Quiet Title/Sale For Division

CVUD-Eviction Appeal/Unlawfyul Detainer

FORJ-Foreign Judgment

FORF-Fruits of Crime Forfeiture

MSHC-Habeas Corpus/Extraordinary Writ/Mandamus/Prohibition

PFAB-Protection From Abuse

FELA-Railroad/Seaman (FELA)

RPRO-Real Property

WTEG-Will/Trust/Estate/Guardianship/Conservatorship

COMP-Workers' Compensation

CVXX-Miscellaneous Circuit Civil Case

ORIGIN: F

R

A

T

INITIAL FILING

REMANDED

APPEAL FROM DISTRICT COURT

TRANSFERRED FROM OTHER CIRCUIT COURT

O OTHER

HAS JURY TRIAL BEEN DEMANDED? Yes No

RELIEF REQUESTED: MONETARY AWARD REQUESTED NO MONETARY AWARD REQUESTED

MEDIATION REQUESTED: Yes No Undecided

ATTORNEY CODE: BLA084 11/13/2009 2:05:29 PM /s DYLAN COOK BLACK

ELECTRONICALLY FILED11/13/2009 2:11 PMCV-2009-903641.00

CIRCUIT COURT OFJEFFERSON COUNTY, ALABAMA

ANNE-MARIE ADAMS, CLERK

1/1961386.1

IN THE CIRCUIT COURT FOR JEFFERSON COUNTY, ALABAMA JEFFERSON COUNTY, ALABAMA, a political subdivision of the State of Alabama, Plaintiff, v. JPMORGAN SECURITIES, INC., a corporation; JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking association; BLOUNT PARRISH & COMPANY, a corporation; CHARLES E. LECROY, an individual; DOUGLAS W. MACFADDIN, an individual; LARRY P. LANGFORD, an individual; WILLIAM B. BLOUNT, an individual; ALBERT W. LAPIERRE, an individual; DEFENDANTS 1 THROUGH 10, BEING THOSE PERSONS, FIRMS OR CORPORATIONS, WHOSE NAMES ARE PRESENTLY UNKNOWN BUT WILL BE ADDED LATER BY AMENDMENT WHEN ASCERTAINED, WHO ARE THE TRUE AND CORRECT NAMES FOR THE DEFENDANTS LISTED ABOVE; DEFENDANTS 11 THROUGH 20, BEING THOSE PERSONS, FIRMS OR CORPORATIONS, WHOSE NAMES ARE PRESENTLY UNKNOWN BUT WILL BE ADDED LATER BY AMENDMENT WHEN ASCERTAINED, WHO CONSPIRED OR OTHERWISE PARTICIPATED WITH OTHER DEFENDANTS TO COMMIT THE ACTS ALLEGED IN THIS COMPLAINT; DEFENDANTS 21 THROUGH 30, BEING THOSE PERSONS, FIRMS OR CORPORATIONS, WHOSE NAMES ARE PRESENTLY UNKNOWN BUT WILL BE ADDED LATER BY AMENDMENT WHEN ASCERTAINED, WHO FRAUDULENTLY CONCEALED AND SUPPRESSED FROM THE KNOWLEDGE OF JEFFERSON COUNTY THE

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CIVIL ACTION NUMBER: CV-2009-_____________




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PAYMENTS DESCRIBED HEREIN; DEFENDANTS 31 THROUGH 40, BEING THOSE PERSONS, FIRMS OR CORPORATIONS, WHOSE NAMES ARE PRESENTLY UNKNOWN BUT WILL BE ADDED LATER BY AMENDMENT WHEN ASCERTAINED, WHO BENEFITED FROM OR OTHERWISE UNLAWFULLY ENRICHED BY THE ACTIVITIES SET FORTH IN THIS COMPLAINT; and DEFENDANTS 41 THROUGH 50, BEING THOSE PERSONS, FIRMS OR CORPORATIONS, WHOSE NAMES ARE PRESENTLY UNKNOWN BUT WILL BE ADDED LATER BY AMENDMENT WHEN ASCERTAINED, WHO SUPERVISED OR DIRECTED THE ACTIVITIES OF OTHER DEFENDANTS NAMED HEREIN, Defendants.

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COMPLAINT

Jefferson County, Alabama (the “County”), a political subdivision of the State of

Alabama, for its complaint against all Defendants, states as follows:

I. INTRODUCTION

1. This is a suit for fraud and fraudulent suppression, conspiracy, and unjust

enrichment against those who have brought the County and its citizens to the brink of financial

disaster while lining their own pockets. JPMorgan Securities, Inc. (“JPMorgan”) was the lead

underwriter for a series of refinancings of the County’s sewer debt. JPMorgan Chase Bank, NA

(“JPMorgan Chase”) was the swap counter-party in related interest rate swaps. The real purpose

of these transactions was to generate hundreds of millions of dollars in fees and interest

payments for JPMorgan and JPMorgan Chase. These transactions provided no value to the

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County or its citizens and created an inherently flawed financial structure that imploded within

just a few years.

2. Charles E. LeCroy and Douglas W. MacFaddin were managing directors of

JPMorgan, with responsibility for JPMorgan’s transactions with the County. Through LeCroy,

MacFaddin, and Blount Parrish & Company (“Blount Parrish”), JPMorgan funded a series of

payments to entice the County to purchase ruinous financial products and services. JPMorgan

then rewarded LeCroy and MacFaddin with huge bonuses, and JPMorgan rewarded Blount

Parrish with huge cash payments.

3. JPMorgan procured this lucrative Jefferson County business by arranging

payments to Blount Parrish. Blount Parrish, through its principal, William B. Blount, and its

agent, Albert W. LaPierre, conspired with former Commission President Larry P. Langford to

direct County business to JPMorgan. The conspiracy involved the payment of cash, clothes, and

jewelry to Langford.

4. The illicit activities described herein placed the County in an untenable,

unwarranted, and ultimately disastrous financial situation, which has resulted in substantial

damages to the County.

II. PARTIES, JURISDICTION, AND VENUE

5. Jefferson County, Alabama, is a political subdivision of the State of Alabama.

6. JPMorgan Securities, Inc. is a corporation organized under the laws of the State of

Delaware, with its principal place of business in New York, New York. JPMorgan served as the

manager or co-manager of seven sewer warrant underwritings for Jefferson County between

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2001 and 2003, and employed both LeCroy and MacFaddin as managing directors in the time

frame relevant to this complaint. On November 4, 2009, the Securities and Exchange

Commission (the “SEC”) censured JPMorgan as a result of some of the conduct alleged in this

complaint.

7. JPMorgan Chase Bank, NA is a national banking association with its principal

place of business in Columbus, Ohio. JPMorgan Chase served as the swap counter-party in eight

interest rate swap transactions with the County in the time frame relevant to this complaint.

JPMorgan Chase sold these interest rate swap transactions to the County and, upon information

and belief, received substantial fees and unreasonable pricing terms favorable to itself as a result

of the actions described in this complaint.

8. Blount Parrish & Company is a corporation organized under the laws of the State

of Alabama, with its principal place of business in Montgomery, Alabama. Blount Parrish was

paid millions of dollars in connection with offerings of Jefferson County’s sewer warrants and

related interest rate swap transactions during the time frame relevant to this complaint. These

payments were made to Blount Parrish as part of the scheme to funnel Jefferson County business

to JPMorgan, as described in this complaint. Upon information and belief, JPMorgan

incorporated these payments into the price Jefferson County paid for these transactions.

9. Charles E. LeCroy is an individual residing, on information and belief, in Winter

Park, Florida. LeCroy was previously employed as a managing director at JPMorgan, where he

was responsible for JPMorgan’s municipal bond business in the Southeast Region. LeCroy was

responsible for orchestrating the scheme to gain Jefferson County’s business for JPMorgan

through the acts described in this complaint. He implemented that scheme by arranging for

5

payments by JPMorgan to firms in Jefferson County and elsewhere in Alabama, and through

multiple visits to Jefferson County, meetings in Jefferson County with former County officials,

and telephone calls to Jefferson County concerning Jefferson County financial transactions.

10. Douglas W. MacFaddin is an individual residing, on information and belief, in

Cos Cob, Connecticut. MacFaddin was previously employed as a managing director at

JPMorgan, where he was head of JPMorgan’s Municipal Derivatives Department at all times

relevant to this complaint. With LeCroy, MacFaddin was responsible for the scheme to gain

Jefferson County’s business for JPMorgan through the acts described in this complaint. He

implemented the scheme, upon information and belief, by arranging for payments by JPMorgan

to firms in Jefferson County and elsewhere in Alabama, and through multiple visits to Jefferson

County, meetings in Jefferson County with former County officials, and telephone calls to

Jefferson County concerning Jefferson County financial transactions.

11. Larry P. Langford is an individual residing in Birmingham, Alabama. Langford

was the President of the Jefferson County Commission from November 2002 through November

2006. On October 28, 2009, a jury convicted him of 60 counts of bribery, money laundering,

conspiracy, mail and wire fraud, and filing a false tax return in connection with his accepting

money, clothes, jewelry, and other things of value from Blount and LaPierre while Commission

President. Langford was instrumental in seeing that Blount Parrish was paid by JPMorgan in

connection with the County’s financial transactions during his tenure as Commission President.

12. William B. Blount is an individual residing, on information and belief, in

Montgomery, Alabama. Blount is chairman and an owner of Blount Parrish, and was involved in

multiple County financial transactions at all times relevant to this complaint. Blount has pleaded

6 1/1961386.1

guilty to one count of conspiracy and one count of bribery in federal court criminal proceedings

as a result of his actions in connection with Jefferson County financial transactions. JPMorgan

paid Blount and his companies millions of dollars in connection with the acts described in this

complaint.

13. Albert W. LaPierre is an individual residing, on information and belief, in

Birmingham, Alabama. LaPierre worked as an operative for Blount during the time frame

relevant to this complaint. LaPierre has pleaded guilty to one count of conspiracy and one count

of filing a false tax return in federal court criminal proceedings as a result of his actions in

connection with Jefferson County financial transactions. LaPierre was paid hundreds of

thousands of dollars for his role in the acts described in this complaint.

14. Defendants 1 through 10, whose names are presently unknown but will be added

later by amendment when ascertained, are those persons, firms, or corporations who are the true

and correct names for the defendants listed above.


later by amendment when ascertained, are those persons, firms, or corporations who conspired or

otherwise participated with other defendants to commit the acts alleged in this complaint.


later by amendment when ascertained, are those persons, firms, or corporations who fraudulently

concealed and suppressed from the knowledge of Jefferson County the payments described

herein.

7


later by amendment when ascertained, are those persons, firms, or corporations who benefited

from or were otherwise unlawfully enriched by the activities set forth in this complaint.


later by amendment when ascertained, are those persons, firms, or corporations who supervised

or directed the activities of other defendants named herein.

19. The actions that form the basis of this complaint occurred in Birmingham,

Alabama; involved the payment of money to Defendants or third parties in connection with

Jefferson County financial transactions closed in Birmingham; resulted in the County having to

pay more for the financial transactions as a result of the conduct described herein; and caused

harm to the County. Therefore, venue is proper in this Court.

20. This Court has personal jurisdiction over the Defendants because they are

Jefferson County residents, or because their actions described in this complaint were

purposefully directed toward Jefferson County such that they had continuous and systematic

contact with Jefferson County during the time period at issue in the complaint, and in some cases

because their contacts resulted in contractual agreements with the County, or because they were

physically present in Birmingham in connection with the events and financial transactions

described in this complaint.

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III. FACTUAL BACKGROUND

A. County Sewer Warrant Offerings And Interest Rate Swap Agreements

21. On December 9, 1996, Jefferson County entered into a Consent Decree with the

United States Environmental Protection Agency and the Department of Justice. The Consent

Decree required the County to renovate, expand, and improve the County’s sewer system, among

other requirements.

22. From 1997 until October 2002, the County issued several series of warrants to

raise the funds necessary for the Consent Decree work. Prior to October 2002, over 95% of the

County’s sewer warrants carried fixed rates of interest.

23. Fixed interest rate debt is a common, conservative form of municipal finance.

This is principally because, with fixed interest rate debt, the interest rate does not change over

time. Fixed interest rate debt is also a preferred method of municipal finance because the interest

rate does not depend on the continued existence of particular market conditions or the continued

viability of any third party market participants, such as auction participants or bond insurers. By

contrast, variable rate debt is a highly risky form of debt because the interest rate is subject to

great fluctuations due to market forces, financial issues experienced by third party credit

providers, and other forces outside the control of the issuer. Variable rate debt is also more

commonly subject to acceleration, where a long-term obligation suddenly becomes due over a

much shorter period of time.

24. In late 2002 and 2003, a number of the County’s fixed-rate sewer warrants were

refinanced, at the urging and advice of JPMorgan, and thereby converted to variable rate debt.

This variable rate debt was issued via three series of warrants that refinanced almost all of the

9

County’s then-existing sewer debt: the 2002-C, 2003-B, and 2003-C sewer warrants. These

series of warrants carried either variable interest rates (“variable rate demand warrants”) or

interest rates set by an auction process (“auction rate warrants”). JPMorgan was the lead

underwriter for the majority of the variable rate demand warrants and the auction rate warrants.

25. After these transactions, the risk profile of the County’s debt structure was

radically different from what it had been before the involvement of the Defendants. By the end

of 2003, approximately 93% of the County’s debt was in the form of variable rate demand

warrants and auction rate warrants, and only approximately 7% remained in the form of fixed-

rate debt. Although these refinancings substantially increased the risk to Jefferson County, they

resulted in the payment of huge fees to JPMorgan, JPMorgan Chase, Blount Parrish, and

substantial fees to other local firms.

26. In connection with the issuance of variable rate and auction rate debt, the

Defendants sold to Jefferson County an additional financial vehicle known as interest rate swaps.

In interest rate swaps, the parties agree to exchange interest payments on a specified principal

amount (referred to as the “notional amount”) for a specified period of time. During the time

period at issue in this complaint, Jefferson County entered into 18 interest rate swap transactions,

with an aggregate notional amount of $5.6 billion. JPMorgan Chase was the County’s largest

provider for interest rate swap transactions closed in 2002 and 2003. JPMorgan and JPMorgan

Chase sold the interest rate swaps to the County as a method of synthetically “fixing” the interest

expense associated with the variable rate and auction rate debt JPMorgan had just induced the

County to issue. JPMorgan Chase was the primary swap counter-party for the interest rate swap

transactions associated with the 2002-C, 2003-B, and 2003-C sewer warrant issues.

10 1/1961386.1

27. JPMorgan, JPMorgan Chase, and Blount Parrish were paid millions of dollars as a

result of the issuance of variable rate demand warrants and auction rate warrants and the closing

of interest rate swap transactions. The price the County paid for these transactions in terms of

fees and interest rates was artificially inflated by millions of dollars, to account in part for the

fact that JPMorgan’s scheme to secure the County’s business included bribes, kickbacks, and

pay-offs the Defendants paid to or received from each other.

28. The new structure exposed the County, to an unconscionable degree, to

fluctuations in its debt service expense on the sewer warrants and on the interest rate swap

transactions. The new structure was vulnerable to changes in various interest rates and to the

whims of an auction process that the County did not, and could not, control or influence, and was

largely dependent on the financial strength and credit rating of the bond insurers who stood

behind the County’s sewer warrants.

29. Beginning in December of 2007, when the national credit rating agencies placed

the bond insurers on “watch” status with negative implications, and continuing through January

and February of 2008 as the insurers’ credit ratings declined and auctions for the County’s

auction rate warrants began to fail, the risky nature of the debt structure JPMorgan foisted on the

County resulted in a cascade of damage that spread across the County. The County’s interest

rates and expense on its sewer warrants skyrocketed. These events also caused the principal

payment schedule for a large portion of the County’s sewer warrants to be shortened from 30

years to four years or less.

30. Because the County could not cover such extraordinary obligations, the ratings on

its other indebtedness – including the County’s general obligation indebtedness and school

11

warrants – plummeted, resulting in additional interest costs and a drain on resources and finances

generally available in the County. These downgrades, and the increased debt service and related

costs that flowed from them, caused enormous reputational damage to the County, preventing

any possible restructuring of its debt profile.

31. The financial and reputational damages incurred by the County from the

Defendants’ conduct are in the billions of dollars.

32. The Defendants have taken affirmative steps to conceal the actions described in

this complaint from County officials not in on the scheme, even as recently as the summer of

2008. The County did not know and could not reasonably have known about the bribes,

kickbacks, and pay-offs involved in these financial transactions until the testimony of witnesses

in Langford’s October 2009 criminal trial, the release of the SEC’s November 4, 2009 cease and

desist order to JPMorgan, and the November 4, 2009 filing of the SEC’s complaint against

LeCroy and MacFaddin. Had the County had knowledge of these schemes it would not have

entertained the plan to restructure the County’s fixed-rate debt to variable rate debt, enter into the

various interest rate swap transactions, and undertake the other agreements with the Defendants

that have left the County in such financial peril.

B. The Undisclosed Payments Began

33. Defendants’ involvement in the fraudulent schemes described herein began when

LeCroy, a managing director at JPMorgan, approached his superiors with a strategy to secure the

County’s sewer warrant business. LeCroy suggested making payments to two local broker-

dealer firms that had influence over certain former County officials. After being encouraged by

their superiors at JPMorgan, LeCroy and MacFaddin embarked on the plan, paying off

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politically-connected local firms even if these firms did no work, or virtually no work, in

exchange for these payments.

34. The scheme was first implemented in connection with the County’s 2002-C sewer

warrants. LeCroy and MacFaddin used the promise of payments to two local, politically-

connected firms to win for JPMorgan the underwriting for that warrant issue. These firms did

not contribute to the underwriting of the 2002-C sewer warrants or serve as swap providers;

indeed, the firms did not have adequate capital to serve as swap providers under Alabama law.

Nevertheless, JPMorgan ensured that both firms were paid a fee of $250,000 in connection with

the 2002-C sewer warrant issue, upon information and belief even suggesting to the firms how

they should submit phony “invoices” to create a paper trail to back up the payments.

35. Neither JPMorgan nor LeCroy nor MacFaddin disclosed these payments to the

County. For this reason, neither the October 23, 2002 Jefferson County Commission resolution

approving the 2002-C warrant offering, nor the official statement for that offering, mentions the

two $250,000 payments to the local firms.

36. The payments by JPMorgan to these local firms – and later, larger payments to

Blount Parrish and others – ran into the millions of dollars and damaged the County because

JPMorgan incorporated many of them into the cost of the related interest rate swap transactions,

even though LeCroy and MacFaddin knew these firms performed virtually no services for the

County.

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C. The Conspiracy

37. In November 2002, Larry Langford became President of the County Commission

and head of the Commission’s Finance Committee. In these capacities, Langford had significant

authority over approval of the County’s warrant deals and interest rate swap transactions,

including which professionals and bankers the County would use in connection with those deals.

Early in his administration, Langford made it clear to Steve Saylor, the County’s Finance

Director, that he wanted Blount and his firm, Blount Parrish, involved in every County financing

transaction. Langford and Blount were long-time friends and political colleagues.

38. Prior to Langford’s involving Blount in County warrant and swap deals, Blount

Parrish had not received any County business from 1997 through 2002. However, Langford was

able to ensure Blount’s selection because his positions as Commission President and head of the

Finance Committee effectively allowed him to control the selection process for underwriters and

swap providers. Unbeknownst to the County, Langford, Blount, and LaPierre embarked on a

conspiracy to exchange Langford’s securing a role for Blount and Blount Parrish in County

financial transactions for hundreds of thousands of dollars in cash, luxury clothing, and jewelry

paid for by Blount, sometimes using LaPierre as the middle-man. The cash, clothing, and

jewelry were to influence and reward Langford in connection with Jefferson County financial

transactions.

39. The conspiracy among Langford, Blount, and LaPierre included, among other

things: Blount’s arranging for Langford to receive a $50,000 loan from Colonial Bank, and then

arranging for LaPierre to take out a loan, guaranteed by Blount, to pay off Langford’s loan when

it came due; tens of thousands of dollars worth of high-end clothing from local clothier Remon’s,

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paid for by Blount or by LaPierre; purchases of designer clothing from Zegna and Ferragamo

stores in New York City, paid for by Blount and later shipped to Langford’s office at the

Jefferson County Courthouse in Birmingham; Blount’s purchasing Langford a $12,000 antique

watch from Tourneau in New York City; and Blount’s purchasing jewelry picked out by

Langford at Bromberg’s.

40. Langford used his power and influence to include Blount Parrish in Jefferson

County financial transactions, thereby generating millions of dollars in fees for Blount and his

companies.

41. These efforts by Langford, Blount, and LaPierre were successful in furthering the

goals of the conspiracy. For example, within just a few weeks of having arranged to pay off the

$50,000 Colonial Bank loan for Langford, Blount Parrish received $300,000 from JPMorgan in

connection with the 2003-B sewer warrant issue, described more fully below. Later, Blount and

LaPierre conspired for Blount to pay to Langford, through LaPierre, the amount of $69,000 cash.

Shortly thereafter, Langford saw to it that JPMorgan paid Blount Parrish $2.6 million in

connection with the 2003-C transaction, described below.

D. The 2003-B Warrants and Interest Rate Swap Agreement

42. From January until May 1, 2003, LeCroy and MacFaddin actively solicited the

County, and Langford in particular, to hire JPMorgan as underwriter on another sewer warrant

offering and to enter into another interest rate swap transaction with JPMorgan Chase that

became the 2003-B transaction. Because Blount Parrish could not serve as an interest rate swap

provider under Alabama’s net capital requirements, Blount solicited Langford to select Goldman

15

Sachs Capital Markets Inc. to participate in the 2003-B swap transaction because Blount Parrish

had a consulting agreement with Goldman Sachs.

43. Goldman Sachs and another firm, Rice Financial Products Co., a New York-based

broker-dealer, were also pitching swap deals to the County. Rice Financial had recently hired a

local consultant who was close to Langford. To prevent Goldman Sachs or Rice Financial from

executing their own swap transactions with the County and ensure the County selected

JPMorgan Chase as the swap provider, LeCroy and MacFaddin negotiated with Langford for

JPMorgan to make payments to those two firms.

44. On February 25, 2003, Langford and the Jefferson County Commission approved

a resolution authorizing the $1.1 billion 2003-B warrant offering, with JPMorgan serving as lead

underwriter and JPMorgan Chase serving as swap provider for the corresponding interest rate

swap agreement. The County approved a second resolution with more details on March 27, 2003.

The interest rate swap agreement was executed on March 28, 2003, with an effective date of May

1, 2003, to coincide with the warrant offering.

45. In presentations and reports sent to the County and credit ratings agencies,

JPMorgan represented the warrant offering and swap agreement as one “finance plan” with a

combined auction rate warrant offering and swap agreement. Furthermore, the 2003-B warrant

offering official statement described the details of both the offering and the swap agreement, and

stated the County entered into the swap agreement “in connection with the issuance of the 2003-

B” warrants. It also stated that JPMorgan Chase’s variable interest rate payments to the County

under the swap agreement were intended to approximate the interest rate the County paid to

warrant investors in the auction market.

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46. In connection with the warrant deal and swap agreement, LeCroy and MacFaddin

agreed in negotiations with Langford to pay Goldman Sachs $3 million, and Rice Financial $1.4

million. In turn, Goldman Sachs agreed to pay Blount Parrish, its consultant, $300,000.

47. To justify these payments, MacFaddin and LeCroy attempted to create a role for

both Goldman Sachs and Rice Financial in the 2003-B swap transaction. Yet neither firm

entered into a swap agreement with the County, or served as an advisor to the County on this

transaction. JPMorgan wired a $1.4 million payment to Rice Financial and paid $3 million to

Goldman Sachs through a separate swap agreement between Goldman Sachs and JPMorgan

Chase created solely as a mechanism to make this payment.

48. JPMorgan, LeCroy, and MacFaddin concealed these arrangements from the

County: the interest rate swap agreement confirmation prepared by JPMorgan and signed by

Langford on behalf of the County did not disclose the payments to Goldman Sachs and Rice

Financial. Instead, MacFaddin set forth the payments in a separate “side letter” he sent only to

Langford (that Langford countersigned) on March 28, 2003 — after the swap agreement in

connection with the 2003-B transaction had been executed. The side letter was never disclosed

to the full Commission or otherwise made public. Because of this concealment, the County

Commission resolutions concerning the 2003-B transaction do not mention Rice Financial or

Goldman Sachs, or the payment to be made to Blount Parrish. Nor does the interest rate swap

agreement confirmation, which Langford signed on behalf of the County, mention any of these

items. Upon information and belief, however, at Langford’s direction, JPMorgan had agreed to

pay all these entities for essentially no work on the transaction. In effect, JPMorgan secured the

County’s work on the 2003-B sewer warrants by paying Goldman Sachs and Rice Financial to

stay out of the deal and by arranging to pay off Goldman’s consultant, Blount Parrish.

17

49. While LeCroy and MacFaddin knew the only reason Langford had required

JPMorgan to pay Goldman Sachs was so Blount Parrish could receive a fee, MacFaddin omitted

any reference in this side letter to Blount Parrish’s fee.

50. Goldman Sachs, however, wrote separately to Langford about Blount Parrish’s

payment. In a letter also dated March 28, 2003, Goldman Sachs wrote that it was paying

“consulting fees” to Blount Parrish, as well as another broker-dealer. Goldman Sachs went on to

“recommend that such payment of fees be made known to bond counsel for the refunding bonds

to be issued so that counsel can determine whether such payments should be included in the

refunding bond offering documents.”

51. However, neither Langford nor LeCroy, MacFaddin nor anyone else at JPMorgan

ever made such a disclosure to bond counsel or any other County officials working on the

warrant offering.

E. The 2003-C Warrants And Interest Rate Swap Agreement

52. JPMorgan determined to bring Blount onto its team in connection with the next

round of sewer warrant refinancing, the $1.05 billion 2003-C sewer warrant issue and the related

$789 million interest rate swap agreement. LeCroy acknowledged, on information and belief,

that Blount Parrish would get a cut of JPMorgan’s fee on the interest rate swap transaction in

exchange for Blount’s ensuring that JPMorgan got the business and for “not messing with us.”

53. LeCroy and MacFaddin, using the funds of their employer JPMorgan, also sought

in this time period to influence other Commissioners by offering to pay off friends hired as

18 1/1961386.1

“consultants” by local firms, or by paying for luxury goods and services for former County

Commissioners during trips to New York.

54. The strategy worked again. JPMorgan was selected as lead underwriter of the

2003-C sewer warrants, and JPMorgan Chase was selected as the swap counter-party on the

related $789 million interest rate swap agreement. The effective date of the swap agreement

coincided with the 2003-C warrant offering closing date. JPMorgan and JPMorgan Chase made

millions of dollars in fees in connection with this transaction, dwarfing the amount of bribes

JPMorgan doled out to make sure it got the business.

55. Ultimately, LeCroy and MacFaddin arranged for Blount Parrish to receive $2.6

million — more than any other participant in the transaction made except JPMorgan itself — in

connection with the 2003-C sewer warrant transaction. This amount was approximately 15% of

the entire underwriting fee, even though Blount Parrish performed virtually no underwriting

services for this payment. The money paid to Blount Parrish was merely a kickback for ensuring

that JPMorgan was selected as underwriter, and JPMorgan Chase as swap provider, on the

transaction.

56. Once again, JPMorgan, LeCroy, and MacFaddin hid the payments to Blount

Parrish and the other local firms from County officials not involved in the scheme. Neither the

July 1, 2003 Commission resolution authorizing the warrant issue nor the official documents for

the 2003-C warrant transaction mention payments to any of these firms. In fact, upon

information and belief, LeCroy was specifically asked at the closing for the 2003-C interest rate

swap transaction about the fees JPMorgan was paying, but he did not mention the three payments

to Blount Parrish and the other local firms.

19

57. Two weeks after the 2003-C swap transaction closed, LeCroy sent a letter only to

Langford, listing the payments to Blount Parrish and the other local firms, and stating, falsely,

that JPMorgan was making them “at the direction of the Commission.” The letter indicated that

JPMorgan was making the payments even though “you have noted that certain firms do not have

the ability to underwrite, distribute or remarket tax-exempt floating rate securities or participate

in providing interest rate swaps.”

58. Significantly, this letter noted that JPMorgan was incorporating the $3.1 million

in payments to the three firms “into the price of the interest rate swap at the time of execution.”

This reduced the amount of money the County would receive from the transaction. Upon

information and belief, JPMorgan Chase, as the swap provider in connection with the 2003-C

transaction, benefitted from the increased interest rates that resulted from JPMorgan’s including

the payments to Blount Parrish and the other local firms in the pricing of the 2003-C transaction.

F. The November 2003 Swap Agreement

59. Even before the 2003-C transaction closed, LeCroy solicited Langford for another

JPMorgan Chase interest rate swap transaction with the County.

60. Again, these efforts proved successful, and again JPMorgan paid off Blount

Parrish and another local firm. On November 7, 2003, JPMorgan Chase and the County

executed a $111 million swap agreement with an effective date of May 1, 2004.

61. During the November 7, 2003 closing, which LeCroy attended in Birmingham

(and which Langford and several County managers and advisors also attended), LeCroy was

asked about the fees JPMorgan was paying as part of the transaction. Again, LeCroy did not

20 1/1961386.1

mention the $225,000 fee to Blount Parrish and the $75,000 fee to another local firm that

Langford had directed JPMorgan to pay in connection with the transaction. Again, JPMorgan

incorporated those fees into the pricing of the transaction, reducing the amount of money

available to the County under the swap transaction and increasing the benefit to JPMorgan Chase

on that same transaction.

COUNT I – FRAUD AND FRAUDULENT SUPPRESSION

62. Plaintiff incorporates Paragraphs 1 through 61 as Paragraph 62 of Count I of this

Complaint.

63. At all times herein, Defendants JPMorgan, JP Morgan Chase, LeCroy and

MacFaddin were sophisticated investment professionals with superior knowledge of the

securities markets, municipal financing, interest rate swap transactions, and related matters.

64. As persons possessing such superior knowledge and as underwriters and interest

rate swap providers for Jefferson County, Defendants had a duty at all times to deal honestly and

openly with Jefferson County, and to disclose to Jefferson County all relevant details of the

transactions Defendants were conducting with Jefferson County, including any payments made

to other parties. Because of the conspiracy between the Defendants, the sewer warrant

refinancing and related interest rate swap agreements were not arms-length transactions.

65. Defendants breached their duty to Jefferson County by making unnecessary and

fraudulent payments to parties who did little or no work on the transactions; by failing to disclose

such payments; and by affirmatively concealing such payments in response to direct inquiry.

21

66. Such conduct by Defendants constitutes fraud and fraudulent concealment under

the common law of the State of Alabama and under Alabama Code § 6-5-100, et seq.

67. Jefferson County reasonably relied on the good faith and honest dealings of

Defendants in using Defendants as investment advisors, underwriters, and swap counter-parties.

Jefferson County was induced to enter into the financing transactions by its reasonable reliance

on the state of affairs as it appeared in the absence of the concealed information.

68. Jefferson County was damaged by the conduct of Defendants as aforesaid. The

full amount of damages to Jefferson County has not yet been ascertained.

69. The conduct of Defendants was willful and intentional.

WHEREFORE, Jefferson County seeks damages against all Defendants in an amount to

be determined by the jury for compensatory damages, plus such punitive damages as the jury

will award.

COUNT II – CONSPIRACY

70. Plaintiff incorporates Paragraphs 1 through 69 as Paragraph 70 of Count II of this

Complaint.

71. At all relevant times, all Defendants conspired and combined unlawfully to

engage in the conduct described herein, and Jefferson County has been injured as a result of this

conspiracy.

72. The conduct of all Defendants in conducting such conspiracy was willful and

intentional.

22 1/1961386.1

WHEREFORE, Jefferson County seeks damages against all Defendants, as a result of

such conspiratorial conduct, in an amount to be determined by the jury for compensatory

damages, plus such punitive damages as the jury will award.

COUNT III – UNJUST ENRICHMENT

73. Plaintiff incorporates Paragraphs 1 through 72 as Paragraph 73 of Count III of this

Complaint.

74. Defendants were unjustly enriched by the conduct described herein, at the

expense of Jefferson County.

75. Defendants should be made to disgorge and repay to Jefferson County all fees and

profits earned as a result of Defendants’ unlawful conduct, together with all damages suffered by

Jefferson County as a result thereof.

76. Defendants’ conduct at all times was willful and intentional.

WHEREFORE, Jefferson County seeks damages against all Defendants for unjust

enrichment in an amount to be determined by the jury for compensatory damages, plus such

punitive damages as the jury will award.

JURY DEMAND

Plaintiff demands trial by jury on all issues herein.

23

November 13, 2009.

/s/ Joseph B. Mays, Jr. Joseph B. Mays, Jr. (MAY004)

Dylan C. Black (BLA084) J. Thomas Richie (RIC078)

Attorneys for Jefferson County, Alabama OF COUNSEL BRADLEY ARANT BOULT CUMMINGS LLP One Federal Place 1819 Fifth Avenue North Birmingham, AL 35203-2104 (205) 521-8000; Fax (205) 521-8800 These Defendants are to be served by certified mail at the addresses shown below: JP Morgan Securities Inc c/o The Corporation Company, Registered Agent 2000 Interstate Park Drive, Suite 204 Montgomery, AL 36109 JPMorgan Chase Bank, National Association c/o The Corporation Company, Registered Agent 2000 Interstate Park Drive, Suite 204 Montgomery, AL 36109 Blount Parrish & Company 10 Court Square Montgomery, AL 36104-3701 Charles E. LeCroy 870 Mayfield Avenue Winter Park, FL 32789

Douglas W. MacFaddin 22 Cottontail Road Cos Cob, CT 06807-1104 Larry P. Langford 300 20th Street North, #306 Birmingham, AL 35203 William B. Blount Blount Parrish & Company 10 Court Square Montgomery, AL 36104 Albert W. LaPierre 1408 Sunshine Drive Birmingham, AL 35213

1/1964035.1

IN THE CIRCUIT COURT FOR JEFFERSON COUNTY, ALABAMA JEFFERSON COUNTY, Plaintiff, v. JPMORGAN SECURITIES INC., et al., Defendants.

)))))))))

CIVIL ACTION NUMBER: CV-2009-______________

JEFFERSON COUNTY’S FIRST REQUESTS FOR PRODUCTION OF DOCUMENTS TO JPMORGAN SECURITIES, INC.

Jefferson County, Alabama (the “County”) propounds its First Requests for the

Production of Documents on JPMorgan Securities, Inc. (“JPMorgan”) pursuant to Alabama Rule

of Civil Procedure 34. These Requests are to be responded to within the time permitted by law.

The responsive documents should be produced at the offices of Bradley Arant Boult Cummings

LLP, 1819 Fifth Avenue North, Birmingham, AL 35203.

DEFINITIONS

1. The word “document” is used in its broadest sense and includes tangible things; it

also includes, but is not limited to, any written, printed or typed correspondence, notes, records,

schedules, tables, charts, reports, memoranda, telegrams, letters, invoices, orders, order forms,

messages, including reports of telephone conversations and conferences, tape recordings,

electronic recordings, contracts, microfilm, computer tapes, disks, diskettes, computer printouts,

electronic mail, computer data files, computer drives, account cards, financial data, statements,

minutes, inter- and intra-office communications, writings, drawings, graphs, photographs, video




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tapes, publications, newspaper or magazine articles, and all other written, printed, or electronic

matter of any kind.

2. “Identify” or “identity,” when used in reference to individual persons, means to

state their full name and present address, their present or last known position and business

affiliation, and their position and business affiliation at the time in question.

3. “Identify” or “identity,” when used in reference to a document, or thing, means to

state its date, author, type of document (letter, memorandum, telegram, chart, etc.), addressee or

other intended recipient or audience, a summary of its contents or other means of identifying it,

and its present location and custodian.

4. “Identify” or “identity,” when used in reference to a conversation, conference, or

meeting, means to identify the people participating in or attending, and to identify its date, place,

and purpose or purposes.

5. “Identify” or “identity,” when used in reference to an entity other than a natural

person, means to state its full name and the address of its principal place of business.

6. “Jefferson County” or “the County” means Jefferson County, Alabama and its

employees, consultants, representatives and agents, and all other persons acting or purporting to

act on its behalf or for its benefit.

7. “You,” “your,” or “JPMorgan” shall mean JPMorgan Securities Inc. and its

representatives, consultants, employees, agents, contractors, affiliates, subsidiaries, and assigns,

and all other persons acting or purporting to act on its behalf or under its control.

INSTRUCTIONS

1. Jefferson County intends to obtain access to JPMorgan’s complete files, including

all non-privileged documents and things in JPMorgan’s possession, and all non-privileged

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documents and things under JPMorgan’s control, which relate directly or indirectly to Jefferson

County and the subject matter of this lawsuit.

2. The word “and” should not be interpreted to exclude from the scope of the

requests any documents that would otherwise be included if the conjunction used were “or” or

“and/or.”

3. If any document or thing requested herein was formerly in your possession,

custody or control but has been lost or destroyed, then you are requested to produce a written

statement which:

a. identifies the nature of the document or thing and its contents;

b. identifies the person who prepared or authored the document or thing; and,

if, applicable, the person to whom the document or thing was sent;

c. specifies the date on which the document or thing was prepared or

transmitted or both; and

d. specifies, if possible, the date on which the document or thing was lost or

destroyed, and if destroyed, the conditions of or reasons for such destruction and the persons

requesting and performing the destruction.

4. If you object to any of these requests for documents and things, you must specify

the grounds for each such objection. If a request contains subparts, object separately to each

objectionable subpart and respond to any non-objectionable subparts. If you lack information

requested by a particular request or subpart, you must respond to the fullest extent possible.

5. If you object that a request on the basis of vagueness or ambiguity, state how you

interpret the request and respond to the request as so stated.

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6. If a document or thing is responsive to a request and is in your control, but is not

in your possession or custody, produce the document or thing and identify the person who had

possession or custody. In particular, if a document or thing is in the possession or custody of one

of your consultants or any other representative with whom you have a contract, produce the

document or thing and identify the representative in whose possession or custody the document

or thing had been held.

7. If any document or thing was, but is no longer in your possession or subject to

your control, identify fully the document or thing, its author or creator, the recipient and all

persons copied, state what disposition was made of it, by whom, and the date or dates or

approximate date or dates on which such disposition was made, and why.

8. If you claim privilege as a ground for failing to produce any document or thing

requested:

a. identify the author or originator of the document or thing, the date

authored or originated, the identity of each person to whom the original or copy was addressed or

delivered, and the identity of each person known or reasonably believed to you to have present

possession, custody or control thereof;

b. identify the factual and legal basis for your claim of privilege in sufficient

detail to permit the court to adjudicate the validity of your claim; and

c. produce any and all portions of each such document or thing that do not

contain any information that you claim to be privileged.

9. Except as otherwise provided in the requests, when producing documents or

things, designate which specific request or requests to which the document or thing is responsive,

or produce the documents and things as they are kept in the ordinary course of business. If a

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1/1964035.1

document or thing is responsive to more than one request, designate all requests to which it is

responsive.

10. Jefferson County reserves the right to move to exclude any evidence whose

disclosure is called for in the following requests for documents and things that JPMorgan does

not produce pursuant to these requests.

REQUESTS FOR PRODUCTION

REQUEST No. 1: Produce all documents, including all recordings, memorializing or

evidencing all conversations referring or relating to JPMorgan’s business, dealings, or

interactions with Jefferson County from January 1, 2000 to the present, including, but not limited

to, all recordings from all trading desks.

REQUEST No. 2: Produce all documents produced to the Securities and Exchange

Commission, the United States Department of Justice, or any other public investigatory body,

whether federal or state, in the course of such investigatory body’s investigation of JPMorgan or

any related person or entity involving or related to Jefferson County. This request includes, but

is not limited to, all materials produced to the Securities and Exchange Commission in the course

of the Securities and Exchange Commission’s investigation of JPMorgan that led to the release

of the Securities and Exchange Commission’s cease and desist order on November 4, 2009.

REQUEST No. 3: Produce all documents relating to all monies, fees, or payments

received by JPMorgan or any affiliated entity in connection with dealings with Jefferson County

from January 1, 2000 to the present. This request includes, but is not limited to, all documents

reflecting all amounts paid in connection with the closing of any transaction relating to the

County, all amounts paid in connection with any interest rate swap transaction, and any other

6

1/1964035.1

payment of any sort whatsoever, and includes all documents which evidence, create, or

memorialize the right or duty for such payment to be made.

REQUEST No. 4: Produce all documents relating to payments or disbursements made

by JPMorgan or any affiliated entity in connection with Jefferson County from January 1, 2000

to the present. This request includes, but is not limited to, all documents reflecting all amounts

paid in connection with the closing of any transaction, all amounts paid in connection with any

swap transaction, and any other payment of any sort whatsoever, and includes all documents

which evidence, create, or memorialize the right or duty for such payment to be made.

REQUEST No. 5: Produce all documents containing, evidencing, or in any way

summarizing or referencing communications between JPMorgan, including its agents,

contractors, or employees, and Jefferson County or any Jefferson County representative from

January 1, 2000 to the present, regardless of who initiated the communication or how the

document came to be in JPMorgan’s possession or control.

REQUEST No. 6: Produce all documents related to the compensation, including

bonuses, paid to JPMorgan employees or agents who had any involvement in JPMorgan’s

dealings with Jefferson County. This request includes, but is not limited to, documents showing

how much compensation Charles LeCroy and Douglas MacFaddin received and how their

compensation was calculated.

REQUEST No. 7: Produce all documents relating to the review or approval of any

transaction involving Jefferson County, including, but not limited to, documents showing which

individuals or committees reviewed or approved JPMorgan’s underwriting activities, interest rate

swap transactions, or any payments made with JPMorgan’s funds related to or arising out of

transactions with Jefferson County.

7

1/1964035.1

REQUEST No. 8: Produce all documents pertaining to the employment of Charles

LeCroy and Douglas MacFaddin, including, but not limited to, their personnel files, any

documents relating to reviewing or evaluating their performance, and any records of disciplinary

or other corrective or adverse action.

REQUEST No. 9: Produce all documents, including internal memoranda, that

evidence, discuss, or otherwise show all payments made in connection with JPMorgan’s dealings

with Jefferson County from 2000 to the present. This request includes, but is not limited to,

documents relating to any payments made to Jefferson County at the purported direction of

Jefferson County or any of its commissioners, and any payments or other transfers of

consideration made by JPMorgan to third parties relating to Jefferson County.

November 13, 2009.



Attorneys for Jefferson County, Alabama OF COUNSEL BRADLEY ARANT BOULT CUMMINGS LLP One Federal Place 1819 Fifth Avenue North Birmingham, AL 35203-2104 (205) 521-8000; Fax (205) 521-8800

8

1/1964035.1

Please serve with Complaint. JP Morgan Securities Inc c/o The Corporation Company, Registered Agent 2000 Interstate Park Drive, Suite 204 Montgomery, AL 36109 JPMorgan Chase Bank, National Association c/o The Corporation Company, Registered Agent 2000 Interstate Park Drive, Suite 204 Montgomery, AL 36109 Blount Parrish & Company 10 Court Square Montgomery, AL 36104-3701 Charles E. LeCroy 870 Mayfield Avenue Winter Park, FL 32789


1/1964051.1


)))))))))


JEFFERSON COUNTY’S FIRST REQUESTS FOR PRODUCTION OF DOCUMENTS TO JPMORGAN CHASE BANK, N.A.


Production of Documents on JPMorgan Chase Bank, NA (“JPMorgan Chase”) pursuant to

Alabama Rule of Civil Procedure 34. These Requests are to be responded to within the time

permitted by law. The responsive documents should be produced at the offices of Bradley Arant

Boult Cummings LLP, 1819 Fifth Avenue North, Birmingham, AL 35203.

DEFINITIONS











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1/1964051.1


matter of any kind.
















7. “You,” “your,” or “JPMorgan Chase” shall mean JPMorgan Chase Bank, NA and

its representatives, consultants, employees, agents, contractors, affiliates, subsidiaries, and

assigns, and all other persons acting or purporting to act on its behalf or under its control.

INSTRUCTIONS

1. Jefferson County intends to obtain access to JPMorgan Chase’s complete files,

including all non-privileged documents and things in JPMorgan Chase’s possession, and all non-

3

1/1964051.1

privileged documents and things under JPMorgan Chase’s control, which relate directly or

indirectly to Jefferson County and the subject matter of this lawsuit.



“and/or.”



statement which:















4

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requested:












5

1/1964051.1


responsive.


disclosure is called for in the following requests for documents and things that JPMorgan Chase

does not produce pursuant to these requests.



evidencing all conversations referring or relating to JPMorgan Chase’s business, dealings, or

interactions with Jefferson County from January 1, 2000 to the present, including, but not limited

to, all recordings from all trading desks.

REQUEST No. 2: Produce all documents produced to the Securities and Exchange

Commission, the United States Department of Justice, or any other public investigatory body,

whether federal or state, in the course of such investigatory body’s investigation of JPMorgan

Chase or any related person or entity involving or related to Jefferson County. This request

includes, but is not limited to, all materials produced to the Securities and Exchange Commission

in the course of the Securities and Exchange Commission’s investigation of JPMorgan Chase

that led to the release of the Securities and Exchange Commission’s cease and desist order

regarding JPMorgan Securities, Inc. on November 4, 2009.


received by JPMorgan Chase or any affiliated entity in connection with dealings with Jefferson

County from January 1, 2000 to the present. This request includes, but is not limited to, all

documents reflecting all amounts paid in connection with the closing of any transaction relating

to the County, all amounts paid in connection with any interest rate swap transaction, and any

6

1/1964051.1

other payment of any sort whatsoever, and includes all documents which evidence, create, or

memorialize the right or duty for such payment to be made.


by JPMorgan Chase or any affiliated entity in connection with Jefferson County from January 1,

2000 to the present. This request includes, but is not limited to, all documents reflecting all

amounts paid in connection with the closing of any transaction, all amounts paid in connection

with any swap transaction, and any other payment of any sort whatsoever, and includes all

documents which evidence, create, or memorialize the right or duty for such payment to be

made.


summarizing or referencing communications between JPMorgan Chase, including its agents,

contractors, or employees, and Jefferson County or any Jefferson County representative from

January 1, 2000 to the present, regardless of who initiated the communication or how the

document came to be in JPMorgan Chase’s possession or control.


bonuses, paid to JPMorgan Chase employees or agents who had any involvement in JPMorgan

Chase’s dealings with Jefferson County. This request includes, but is not limited to, documents

showing how much compensation Charles LeCroy and Douglas MacFaddin received and how

their compensation was calculated.


transaction involving Jefferson County, including, but not limited to, documents showing which

individuals or committees reviewed or approved JPMorgan Chase’s underwriting activities,

7

1/1964051.1

interest rate swap transactions, or any payments made with JPMorgan Chase’s funds related to or

arising out of transactions with Jefferson County.

REQUEST No. 8: Produce all documents pertaining to the employment of Charles

LeCroy and Douglas MacFaddin, including, but not limited to, their personnel files, any

documents relating to reviewing or evaluating their performance, and any records of disciplinary

or other corrective or adverse action.


evidence, discuss, or otherwise show all payments made in connection with JPMorgan Chase’s

dealings with Jefferson County from 2000 to the present. This request includes, but is not

limited to, documents relating to any payments made to Jefferson County at the purported

direction of Jefferson County or any of its commissioners, and any payments or other transfers of

consideration made by JPMorgan Chase to third parties relating to Jefferson County.

November 13, 2009.




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1/1964163.1


)))))))))


JEFFERSON COUNTY’S FIRST REQUESTS FOR PRODUCTION OF DOCUMENTS TO BLOUNT PARRISH & CO.


Production of Documents on Blount Parrish & Company. (“Blount Parrish”) pursuant to

Alabama Rule of Civil Procedure 34. These Requests are to be responded to within the time

permitted by law. The responsive documents should be produced at the offices of Bradley Arant

Boult Cummings LLP, 1819 Fifth Avenue North, Birmingham, AL 35203.

DEFINITIONS











2

1/1964163.1


matter of any kind.
















7. “You,” “your,” or “Blount Parrish” shall mean Blount Parrish & Company and its

representatives, consultants, employees, agents, contractors, affiliates, subsidiaries, and assigns,

and all other persons acting or purporting to act on its behalf or under its control.

INSTRUCTIONS

1. Jefferson County intends to obtain access to Blount Parrish’s complete files,

including all non-privileged documents and things in Blount Parrish’s possession, and all non-

3

1/1964163.1

privileged documents and things under Blount Parrish’s control, which relate directly or

indirectly to Jefferson County and the subject matter of this lawsuit.



“and/or.”



statement which:















4

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requested:












5

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responsive.


disclosure is called for in the following requests for documents and things that Blount Parrish

does not produce pursuant to these requests.



evidencing all conversations referring or relating to Blount Parrish’s business, dealings, or

interactions with Jefferson County from January 1, 2000 to the present.

REQUEST No. 2: Produce all documents produced to or requested by the Securities

and Exchange Commission, the United States Department of Justice, or any other public

investigatory body, whether federal or state, in the course of such investigatory body’s

investigation of Blount Parrish or any related person or entity involving or related to Jefferson

County.


received from any source by Blount Parrish or any affiliated entity or person in connection with

dealings with Jefferson County from January 1, 2000 to the present. This request includes, but is

not limited to, all documents reflecting all amounts paid in connection with the closing of any

transaction relating to the County, all amounts paid in connection with any interest rate swap

transaction, and any other payment of any sort whatsoever, and includes all documents which

evidence, create, or memorialize the right or duty for such payment to be made.


by Blount Parrish or any affiliated entity in connection with Jefferson County from January 1,

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1/1964163.1

2000 to the present. This request includes, but is not limited to, all documents reflecting all

amounts paid in connection with the closing of any transaction, all amounts paid in connection

with any swap transaction, and any other payment of any sort whatsoever, and includes all

documents which evidence, create, or memorialize the right or duty for such payment to be

made.


summarizing or referencing communications between Blount Parrish, including its agents,

contractors, or employees, and Jefferson County or any purported Jefferson County

representative from January 1, 2000 to the present, regardless of who initiated the

communication or how the document came to be in Blount Parrish’s possession or control.


bonuses, paid to Blount Parrish employees or agents who had any involvement in Blount

Parrish’s dealings with Jefferson County. This request includes, but is not limited to, documents

showing how much compensation William Blount received and how his compensation was

calculated.


transaction involving Jefferson County, including, but not limited to, documents reflecting any

review or approval of Blount Parrish’s activities related to or arising out of transactions with

Jefferson County.


evidence, discuss, or otherwise show all payments made in connection with Blount Parrish’s

dealings with Jefferson County from 2000 to the present. This request includes, but is not

limited to, documents relating to any payments made to Jefferson County at the purported

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1/1964163.1

direction of Jefferson County or any of its commissioners, and any payments or other transfers of

consideration made by Blount Parrish to third parties relating to Jefferson County.

REQUEST No. 9: Produce all documents relating to communications between Blount

Parrish or Blount Parrish’s principals, agents, or employees and JP Morgan Securities or JP

Morgan Chase Bank from 2000 to the present. This request includes, but is not limited to, all

documents related to communications with Charles LeCroy or Douglas MacFaddin. It also

includes, but is not limited to, documents relating to the determination of Blount Parrish’s role in

any financing in which JP Morgan was involved (whether or not the transaction involved

Jefferson County), and the calculation of Blount Parrish’s compensation in connection with any

such transaction.

REQUEST No. 10: Produce all documents related to payments made by Blount Parrish

to William Blount, including the document that provides the basis for such payment (e.g.,

employment contract, partnership or other corporate agreement; bonus calculations, etc.).

REQUEST No. 11: Produce all documents related to payments made by Blount Parrish

to Larry Langford, Albert LaPierre, or any entity wholly or partially owned by either of them or

for which either acted as agent.

Respectfully submitted this 13th day of November, 2009.

/s/ Joseph B. Mays, Jr. Joseph B. Mays, Jr.

Dylan C. Black J. Thomas Richie


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