Assured Guaranty (AGO) and JPMorgan Chase (JPM) agreed to settle lawsuits accusing the mega bank’s EMC Mortgage and Bear Stearns units of making misrepresentations about mortgage-backed securities, Bloomberg news reports. The publication outlined the legal arguments behind the suit:

Assured Guaranty, a New York-based unit of the Hamilton, Bermuda-based bond insurer, sued EMC, J.P. Morgan Securities Inc. and JPMorgan Chase Bank NA in state and federal court in New York starting in 2010, alleging violations of representations and warranties in connection with three residential mortgage-backed securities transactions.