It is, on one level, an infuriating defense because it suggests that firms like Goldman and JPMorgan owe no fiduciary responsibility to their customers. All responsibility for investment decisions lies with the clients  even when they have handed over “complete discretion and authority” of the account to the firm in question, as happened in this case. JPMorgan does not even hold itself responsible for advising Mr. Blavatnik’s executives to hold onto the triple-A securities once they started to decline. Since the investment experts working for Mr. Blavatnik didn’t realize they were supposed to ignore the advice they were getting from JPMorgan investment experts, they have only themselves to blame for the losses. Or so implies the defense.

On the other hand, it is not as if Mr. Blavatnik’s team of experts handed over $1 billion to JPMorgan without knowing what was happening to that money. They had those investment guidelines, after all, which allowed for 20 percent of the portfolio to be invested in mortgage backed securities, and another 20 percent in asset-backed securities. It got monthly statements, which JPMorgan claims (and Mr. Blavatnik’s team denies) spelled out how the money was invested in great detail.

And the reason JPMorgan pressed Access to hold onto the mortgage-backed securities as they started to decline was because the people managing the account truly believed they would bounce back. They were triple A, after all! They had to be safe. That is what everyone believed, JPMorgan and Access Industries included. If Access Industries had thought mortgage-backed securities were too risky for its cash, it shouldn’t have made them part of the guidelines. Indeed, if investment managers had to make investors whole every time they gave bad advice, the profession would disappear overnight. (Hmmmm. ...)

This logic is also why these cases are so difficult to win, even though the banks so clearly treated clients shabbily during the bubble years. Judges are loath to second-guess investment advice, even when it turns out to be dead wrong.

“Essentially, plaintiff’s position is that defendants had too much appetite for risk, and did not disclose that risk in statements, even if their investment decisions did result in a portfolio that comported with the sector diversification guidelines,” wrote Judge Melvin L. Schweitzer of the New York Supreme Court in a ruling he issued last February. In effect, he ruled, it didn’t matter how negligently JPMorgan acted; so long as it stayed within the agreed-upon guidelines, the bank was off the hook. He threw that part of the case out. (Both sides are awaiting an appeals court ruling on this and other issues.)

In most such cases, that would be the end of it  the investor would take it on the chin, and the bank would walk away scot-free, ready to sell more bad securities to more of its sophisticated clientele as soon as the next bubble rolls around. If you are a dominant bank, there is no downside for serving clients badly.

In this case, however, Mr. Blavatnik had an ace up his sleeve. JPMorgan Chase, he alleged, didn’t just take too much risk inside a set of approved guidelines  it violated those guidelines. Instead of holding to that agreed-upon 20 percent of mortgage-backed securities in the portfolio, it actually turned out that 46 percent of the Access portfolio was in mortgage-backed securities, including those securities backed by home equity loans.