JPMorgan (NYSE:JPM) Brand at Risk in Madoff-Related Lawsuit

Anything that could taint an individual or company with the reputation of Bernie Madoff could be devastating, and that's what JPMorgan Chase (NYSE:JPM) is facing now.

In a lawsuit filed by trustee, Irving Picard, JPMorgan is accused of seeking to generate revenue by offering products connected to Madoff even when they aired concerns over how legitimate the returns related to Madoff products were.

The lawsuit was announced back in the early part of December, but on Thursday the extent of the allegations of Picard against JPMorgan was revealed via an unsealed version of the suit.

According to Picard, JPMorgan ignored the doubts they had about Madoff offerings and went ahead with the investments anyway.

JPMorgan responded to the new revelations, saying, "J.P. Morgan did not know about or in any way become a party to the fraud orchestrated by Bernard Madoff. Madoff's firm was not an important or significant customer in the context of J.P. Morgan's commercial banking business."

JPMorgan Chief Executive Officer, James Dimon, added that the lawsuit was "based on distortions of both the relevant facts and the governing law."

Picard is seeking $6.4 billion in damages in the complaint.

JPMorgan was trading at $44.65, falling $0.81, or 1.78 percent, as of 12:49 PM EST.