Lawyers for Corzine Seek Case’s Dismissal

Jon S. Corzine, the former New Jersey governor accused of a failure of leadership at the helm of the brokerage firm MF Global, is fighting back.

Lawyers for Mr. Corzine filed a motion late Tuesday to dismiss a civil case against him brought by the Commodity Futures Trading Commission, the federal agency that regulated MF Global until its demise in 2011. The 30-page motion, filed in Federal District Court in Manhattan, outlined Mr. Corzine’s defense and leveled a sharp critique of the commission, depicting the agency’s lawsuit as poorly drafted and error prone.

“There is no evidence demonstrating that Mr. Corzine knowingly directed unlawful conduct or acted without good faith,” wrote the lawyers from Dechert, Andrew J. Levander and Benjamin E. Rosenberg. “Rather than acknowledge that reality and move on, the C.F.T.C. has clung to its baseless presumptions and manufactured charges of wrongdoing that are supposedly connected to Mr. Corzine.”

The commission’s case, filed in June, stems from the largest Wall Street failure since the financial crisis. Mr. Corzine ran MF Global when in October 2011 it misused more than $1 billion in customer money and went bankrupt.

Mr. Corzine’s risk-taking, the commission claims, paved the way for the firm’s collapse. As chief executive, he failed to prevent a lower-level employee from using customer money to plug holes in the brokerage firm’s books, the commission says. The commission also sued that employee, Edith O’Brien, who oversaw the transfer of customer money to banks.

Customer money is supposed to be sacrosanct on Wall Street, where firms are largely required to keep it segregated from their own funds.

The commission did not accuse Mr. Corzine of authorizing the breach of the customer money, or even knowing that the wrongdoing had happened. Instead, the suit hinges on his supposed failure to “diligently supervise” the firm as it raided the client accounts. The suit also argues that Mr. Corzine was subject to so-called control person liability, a legal provision that allows for the punishment of executives for the acts of lower-level employees like Ms. O’Brien.

In the motion to dismiss the case, Mr. Corzine’s lawyers raised doubt about that charge. To prevail on the charge, the commission must show that he had a responsibility to oversee Ms. O’Brien, which the lawyers dispute.

“No C.E.O. of an entity with operations around the globe and thousands of employees can be accurately described as the ‘supervisor’ of every employee and transaction,” the lawyers said.

Although Mr. Corzine could strike a settlement with the government, the motion on Tuesday could foreshadow a lengthy clash. If found liable at trial, Mr. Corzine could face fines and a ban from trading commodities. Mr. Corzine, whose passion for trading made him a star at Goldman Sachs and continues to occupy him even now, is expected to fight any such penalty.

At one time, his fate seemed even more precarious. MF Global’s collapse set off a wave of scrutiny from regulators as well as prosecutors and the F.B.I. Now, with Mr. Corzine no longer drawing scrutiny from the criminal authorities, the commission is the most active threat.

Mr. Corzine’s lawyers object to the commission’s attempt to link him, even tangentially, to the breach of customer money. The commission declared that Mr. Corzine “did not direct anyone to determine whether” MF Global was raiding customer accounts, his lawyers said, but stopped short of claiming that he had “any reason to believe” that the money was in jeopardy.

And a damaging line in the government’s suit is inaccurate, the lawyers said. The suit said that when Mr. Corzine was informed that JPMorgan was seeking $134 million to patch an overdrawn account, he told Ms. O’Brien to meet JPMorgan’s demands, telling her that it was “the most important thing” she could get “done that day.”

But the lawyers say, “Mr. Corzine was not a participant in the quoted conversation and the quotation is inaccurate because the words ‘can get done that day’ were not part of the conversation.” The commission hasn’t publicly admitted the error.

In addition to criticizing the merits of the case, Mr. Corzine’s lawyers took aim at the government’s prose. The commission’s complaint featured “rambling hindsight criticisms,” the lawyers said, to say nothing of the “confusing amalgam of accusations.”