By Karen Freifeld
NEW YORK (Reuters) - Trustees involved in JPMorgan Chase & Co's
The trustees rejected the deal for six of about 330 trusts included in the offer, according to a notice posted on a website run by the trustees.
Twenty seven trusts obtained an extension until Oct. 1 for one or more loan groups.
JPMorgan reached the $4.5 billion agreement in November with 21 institutional investors in 330 residential mortgage-backed securities trusts issued by JPMorgan and Bear Stearns, which the bank took over during the financial crisis. One of the trusts was later excluded from the deal.
The settlement would resolve claims over misrepresentations in the quality of mortgages packaged into securities before the collapse of the U.S. housing market.
The trustees, who included Bank of New York Mellon
JPMorgan does not have to go through with the $4.5 billion deal if the number of trusts that reject the deal are in excess of a confidential limit the parties negotiated.
Assuming it goes forward, the trustees will seek court approval for the trusts that accept the agreement.
"We are pleased that the Trustees have accepted the settlement for so many trusts," said Robert Madden, a lawyer with Gibbs & Bruns, the Houston law firm that represents the institutional investors who struck the deal.
He said the deal offers "enormous benefits."
"We believe the acceptance by the Trustees of the overwhelming majority of the 330 trusts is a significant step toward finalizing the settlement", a JPMorgan spokeswoman said in a statement.
Representatives of the trustees declined to comment or did not respond to requests for comment.
In a July 17 report, an expert for the trustees, Daniel Fischel, recommended that the proposed settlement be accepted for 314 trusts and that the trustees consider rejecting the settlement for 16 trusts.
The expert said that before rejecting the proposed settlement for any trust, the trustee should be confident a group of investors is willing to pursue claims.
The 21 investors who agreed to the deal in November include BlackRock Inc, Metlife Inc
The settlement does not include trusts issued by Washington Mutual, which JPMorgan also acquired.
The offer was announced last year just before JPMorgan reached a $13 billion settlement with U.S. government authorities over defective mortgages packed into securities before the 2008 financial crisis.
Bank of America Corp
(Reporting by Karen Freifeld; Editing by Lisa Shumaker)