In Ambac Assur. UK Ltd. v. J.P. Morgan Invest. Mgt., Inc. (88 A.D.3d 1, 928 NYS2d 253 [1st Dept 2011]), Plaintiff Ambac Assured U.K., Ltd. ("Ambac") guaranteed timely payment of principal and interest on certain notes issued by Ballantyne to raise capital. Ballantyne Invested $1.65 billion of the proceeds from the notes with defendant J.P. Morgan Investment Mgt., Inc. ("JP Morgan") and JP Morgan had full discretionary authority over the accounts established which was subject only to the investment guidelines set forth in the parties' IMA. The guidelines stated that the goal was "to obtain reasonable income while providing a high level of safety of capital" and they set forth various nature, quality and diversification requirements and specific limits based on sectors and ratings. Thus, the permitted securities included home equity loan asset-backed securities ("HELOS") and mortgage-backed securities ("MBS") as long as they had required ratings of A through AAA and did not exceed 60% and 50% of the two accounts, respectively. The IMA had a "Discharge of Liability" provision that provided that JP Morgan did not guarantee the future performance of the accounts nor any specific level of performance and that it would have no liability for losses unless they were determined to be proximately caused by JP Morgan's gross negligence or wilfull misconduct. Plaintiff sued JP Morgan for breach of the IMA, breach of fiduciary duty and gross negligence for the losses Ballantyne sustained as a result of JP Morgan's management of its accounts. The suit arose largely from an article wherein JP Morgan's CEO, Jamie Dimon, was quoted as having concluded as early as October 2006 that the subprime securities market "could go up in smoke" and as a result, instructed the head of JP Morgan's securitized products to "sell a lot Of our positions" (Ambac Assur. UK Ltd., 928 NYS2d at 256).