LOS ANGELES (CN) - A millionaire soft-core porn king claims in court that JPMorgan Chase violated the law and its own policies by refusing to underwrite a loan, for "moral reasons."
Marc L. Greenberg - the producer behind the soft-core porn series "Co-Ed Confidential" and "The Best Sex Ever," among others - claims that Chase advertises its commitment to fair lending and non-discriminatory business. So when a JPMorgan Securities vice president approached him about refinancing one of his properties in Marina Del Ray, Greenberg says, he expected to be treated fairly - regardless of his profession.
He sued JPMorgan Chase & Co. in Superior Court.
"As a current JPMorgan securities customer and home loan lendee, plaintiff had previously researched and was familiar with JPMorgan's representations and promises of commitment to fair lending, diversity and non-discriminatory practices. Based on these representations and fair lending policies, plaintiff decided to obtain a home loan refinance service from JP Morgan," Greenberg says in his complaint.
Greenberg says he expected a quick approval, given his established relationship with Chase, an annual income of more than $500,000 and a net worth of more than $10 million.
But Greenberg claims Chase gave him the runaround for four months, telling him he needed to speak to a credit specialist because of questions "regarding income."
Whether Greenberg ever spoke to a credit specialist is not specified in then complaint. But by Aug. 15, 2012 -after four months of processing - Greenberg says he called JPMorgan Securities Vice President Adam Gelcich directly.
"Adam Gelcich was evasive in his response to plaintiff's application status requests and finally informed plaintiff during a telephone conversation that plaintiff's loan application was refused due to 'moral reasons,' because of JPMorgan's disapproval of plaintiff's former source of income and occupation as an owner of a television production company that produced television programs that dealt with the subject of human sexuality. Plaintiff's repeated attempts to obtain a written statement of the reasons for the denial of his loan application and a copy of JPMorgan's 'morals clause' were ignored. Communication with Adam Gelcich abruptly ceased," Greenberg says in his complaint.
Gelcich is not a party to the complaint. The only defendant is the bank and Does 1 to 100.
Greenberg claims he sent Gelcich an email crying foul over what he perceived to be JPMorgan Chase's discriminatory lending practice. He threatened legal action and served the bank with an intent to sue notice - which caught the attention of Deb Vincent, a VP in Chase's legal fair lending department.
Greenberg says Vincent asked for information to locate Greenberg's file. He says he gave her his Social Security number, Chase account number and address.
"On Dec. 13, 2012 plaintiff received a letter from Deb Vincent stating that they are 'unable to provide any resolution to [plaintiff's] allegations, as [JPMorgan] is unable to locate any refinance application from [plaintiff]," Greenberg says in the complaint. (Brackets in original.)
For the next several weeks, Greenberg's lawyers pressed Vincent to find the loan application, according to the complaint. Eventually, Greenberg claims Vincent, told him Gelcich no longer worked for Chase and she was "'unable to locate someone who may have worked with or managed Adam Gelcich.'"
But Greenberg claims says Gelcich was still working at JPMorgan Chase - which is where Greenberg's legal team discovered him and had a little chat.
"Adam Gelcich contemptuously informed plaintiff's counsel that 'JPMorgan can deny an application for reputational risk to our firm' and mockingly added that plaintiff was 'making a big deal over nothing' and 'good luck' in obtaining legal relief," Greenberg says in his complaint.
Greenberg claims that Gelcich's comments were backed up by a letter from David Struss, JPMorgan Chase's executive director and assistant general counsel. In the communication, Struss denied the accusations of unfair lending, saying the bank complied with federal and California regulations in processing Greenberg's application.
"As a result of defendant's actions, plaintiff was denied equal access to basic economic opportunities based on his former ownership of a television production company that dealt with the subject of human sexuality. JPMorgan's attempted justification of their discrimination is morally repugnant and has no place in JPMorgan's banking practices," Greenberg says in his complaint.
Then Greenberg says, look who's talking:
"In addition, JPMorgan's discrimination against plaintiff on 'moral' grounds is particularly repugnant and hypocritical coming from a corporation under federal investigation for illegal, immoral and unethical conduct, including: A. Multibillion dollar trading losses that cost its shareholders between $5 billion and $15 billion; B. A criminal investigation of top JPMorgan executives by the FBI over lying to investors and federal regulators with respect to the multibillion dollar trading losses; C. Misstatements by JPMorgan regarding how the bank harmed more than 5,000 homeowners in foreclosure; D. Inadequate controls against money laundering that allow tainted money to move through the bank's network; E. Violations of federal law in failing to report suspicious transactions of Bernie Madoff; F. Selling CDOs [collateralized debt obligations] to customers by concealing that the CDOs were comprised of failing home loans; G. Rigging bids to cities and counties; H. Overcharging and manipulating electrical power markets resulting in JPMorgan being barred from the electrical power market; I. Engaging in transactions involving Cuba, Iran and Sudan in violation of the U.S. embargoes."
Greenberg continues: "Despite JPMorgan's lack of morality when considering its own conduct, JPMorgan purports to be so ashamed of nudity and human sexuality that it cannot process a refinance of a home loan of plaintiff, secured by plaintiff's house, because plaintiff's source of income six years ago included production of television programs that contained nudity and human sexuality. JPMorgan has overlooked its own moral transgressions as it continues to mislead shareholders, mislead customers, manipulate markets and trade with enemies of the United States, but it is relentless in seeking to punish plaintiff for his former involvement in television programming involving human sexuality that JPMorgan purportedly finds to be shameful.
"In rejecting plaintiff's application, JPMorgan asserted that its superior moral position prevented it from loaning plaintiff money because one of plaintiff's sources of income did not meet JPMorgan's 'morality standards' and that the 'reputational risk' of loaning plaintiff money threatened JPMorgan's public image. JPMorgan's hypocrisy would be laughable except plaintiff was in fact illegally discriminated against and denied a loan by JPMorgan."
Greenberg claims he was "highly offended" by Chase's rejection of his application, noting that the bank has held the first deed of trust on his home for years and never said a word about his line of work.
"The rejection simply made no sense to plaintiff. Was JPMorgan, a bank whose multiple illegal dealings were under investigation by no fewer than eight different federal agencies (including the FBI, FDIC, SEC, the Commodity Futures Trading Commission, the Office of Controller of the Currency and federal prosecutors in Manhattan) really so ashamed of sex and nudity that they refused to consider plaintiff's loan application? It seemed impossible. Plaintiff was humiliated to be rejected by a bank as unscrupulous as JPMorgan because, according to JPMorgan, plaintiff was 'immoral' and presented a 'reputation risk' to JPMorgan," Greenberg says in his complaint.
Greenberg suggests that his purveyance of skin flicks on late night cable may not be the only reason for Chase's rejection of his loan application.
"Additionally, plaintiff believes that JPMorgan may have discriminated against him for other reasons including, but not limited to, his Jewish ethnic heritage and religious beliefs, his status as a Hollywood producer, or the loan officer's arbitrary and irrational jealousy of plaintiff's success. Plaintiff believes discovery will show additional reasons for JPMorgan's illegal discrimination against him," the complaint states.
It continues: "Plaintiff's counsel communicated repeatedly with JPMorgan's legal department and pointed out JPMorgan's poor position to be judging the morals of others as well as the illegality of such discrimination. Plaintiff's counsel directed JPMorgan to its own published claim of commitment to fair, equal and non-discriminatory lending practices. JPMorgan initially denied that they had any loan application from plaintiff. After plaintiff demonstrated that he had in fact applied for a loan and had been rejected for 'moral' reasons, JPMorgan refused to remedy the wrongful denial and instead asserted that the discrimination by JPMorgan was not actionable. As a result of defendant's unlawful acts and practices, plaintiff was denied the opportunity to obtain a home loan refinance through JPMorgan and missed the opportunity to obtain a home loan refinance for lower rates and superior terms. Plaintiff has paid and will continue to pay more money at higher interest rates and fees on his home to JPMorgan. Plaintiff has suffered humiliation, mental anguish and emotional distress in addition to monetary damages in an amount to be proven at trial."
Greenberg seeks an injunction and damages for violations of the federal Fair Employment and Housing Act, the Unruh Civil Rights Act and California's consumer protection and fair business laws.
He is represented by Bradford Child and Gordon Kwan with Child & Marton.
Greenberg never identifies himself in the complaint as a soft-core pornographer. He refers to himself throughout as a maker of films "that dealt with the subject of human sexuality."