Failed US hedge fund manager Amaranth Advisors has sued JP Morgan Chase claiming the US bank caused its collapse by sabotaging its negotiations with Goldman Sachs over the sale of an energy derivatives portfolio.

The lawsuit claims JP Morgan Chase used its position as the hedge fund's broker to scupper a sale of the portfolio to Goldman Sachs. This allegedly forced Amaranth to sell the portfolio to JP Morgan Chase and US hedge fund manager Citadel on less favourable terms.