Citadel Investment Group was “too big to fail”—a distinction that might have forced JPMorgan Chase to lift a trading lockout it imposed on the hedge fund for poaching its staff.

In a Thursday profile of the Chicago company, The Wall Street Journal noted regulatory pressure for Wall Street not to alter its trading with Citadel out of fear of a “ripple effect” if the fund had a selloff or had to be liquidated.

The newspaper went on to report that Deutsche Bank, counterparty to Citadel, had been one company subject to that demand. Renee Calabro, spokeswoman for Deutsche Bank in New York, declined comment.

The newspaper hinted that the global financial crisis might have “helped Citadel pull through” 2008.

Last fall, rumor surfaced that the Federal Reserve System had been probing counterparty trading at Citadel to find out if it could have an impact on the besieged finance sector.

Citadel had managed $20 billion until the financial crisis reportedly gutted the fund to $10 billion. Additional drama came in the form of a hiring spree Citadel had undertaken in order to transform itself into an investment bank. Citadel in particular targeted JPMorgan Chase, cherry picking personnel in the wake of the JPMorgan-Bear Stearns deal.

That continued poaching raised the ire of Jamie Dimon, the tough-talking Wall Street operator and chief executive officer of JPMorgan. The bank retaliated by locking out Citadel as a trading partner—a lockout that was lifted after a single day. Citadel was then made to put up more collateral on Wall Street, as a guarantee.

JPMorgan went on to sue IDW Group, the executive search group that poached its staff.

Citadel boss Kenneth Griffin had come under fire in the past for his hiring. Daniel Loeb, head of hedge fund Third Point, lambasted Griffin in an e-mail for poaching Greenlight Capital.

Kristin Lemkau, spokeswoman for JPMorgan, did not call HedgeFund.net back. Citadel spokeswoman Devon Spurgeon categorically denied that The Fed had any concern about Citadel and that the lifted JPMorgan trade ban came about from that concern.

Denise Valentine, Aite Group analyst, characterized the fall of 2008 as an “unusual time” for the finance sector.

“It is very conceivable that the government made JPMorgan lift the ban, it would be logical,” Valentine said. “The primary focus of the government at the time was to stabilize, no matter what. And the government was panicking.”

But Valentine added the recent criticism of regulation, evidenced in the grilling of U.S. Secretary of the Treasury Timothy Geithner on Capitol Hill on Thursday, has made drawing a concrete conclusion difficult.

“They are being criticized for what they did,” she said. “So would it make sense? Yes. Will we ever know? No. It would be bad for both of them.”