LRS: You're suing for failing to disclose information about a certain trade? And also for fraud?
Robbins: It's the basic securities fraud suit. They made statements and those statements were materially false and misleading. They misrepresented their risk. And took overly risky positions.
One might say what they did is hedge. One commonly thinks of a hedge as protecting against fluctuations. What people didn't know is they were taking a directional bet.
This isn't the first suit about problematic trading. What's interesting about this case is they had notice. Jamie Dimon has repeatedly said he's on top of things and in touch with what's going on. In April, when news stories came out about price disparities and about the "London Whale," they had to go back and check on the disparities and on their positions. Then they got asked about it on the April conference call.
LRS: JPM hasn't locked in its losses. They could, theoretically, still make money on this bet. Or they could lock in the loss, but the stock price could go up anyway. What then?
Robbins: The damage is already done. Investors already took the losses. Under the securities laws, there's a 90-day look-back period.
The losses are capped at an amount calculated from the mean average trading price after the initial loss.
LRS: What are the chances of success against Jamie Dimon as an individual?
Robbins: We've named three people. Jamie Dimon, the CEO; Ina Drew, the CIO; and Douglas Braunstein, the CFO.
We feel very strongly that there were statements made, statements that Jamie Dimon is responsible for, that were knowingly or recklessly false.
LRS: You didn't name Bruno Iksil, the trader known as the "London Whale"?
Robbins: No, we didn't name the London Whale.
LRS: Does it matter whether key players leave the company?
Robbins: No, it doesn't matter at all.
LRS: Are the members of the class required to hold on to their shares until the case is resolved?
Robbins: They can do whatever they want. If they sell, there's a complicated calculation to figure out their loss, based on when they sell, etc.
LRS: What happens to the case now? What's the timeline?
Robbins: When you file a case, you file a notice, which is the press release. Anyone can apply to be a lead plaintiff within 60 days. The court approves the plaintiff, the counsel, etc. There will be a motion to dismiss by JPM. Then the judge decides whether the case should proceed.
LRS: How long does it normally take to go to trial or reach a settlement?
Robbins: I used to say the average life of a securities suit is 18 months. Now it's 2-1/2 years. I don't know exactly why. It's just what I've observed.
Sometimes securities case are complicated. This one is straightforward.
Questions? Comments? Tips? Email us atNetNet@cnbc.comor send a text message to: 9170740-8477.
You can also be our friend on Facebook.