Lehman sues Credit Suisse to expunge $1.1 billion 'inflated' claims
NEW YORK (Reuters) - Lehman Brothers Holdings Inc has sued Credit Suisse Group AG (VTX:CSGN), seeking to reduce "inflated" bankruptcy claims by roughly $1.1 billion (£686,684,562.08), and also recover about $150 million from the Swiss bank.
In a complaint filed on Wednesday in U.S. Bankruptcy Court in Manhattan, Lehman accused Credit Suisse of exaggerating claims related to the early end of tens of thousands of derivatives transactions.
Lehman calculated that the $1.19 billion in Credit Suisse claims at issue may be worth just $74.6 million. Lehman also estimated that Credit Suisse owes it roughly $150 million on some international transactions.
"Credit Suisse failed to offset counterbalancing positions, opportunistically selected favorable valuation dates and times, and valued its positions inconsistently to its own advantage, all without adequate - or any - justification," Lehman said.
Lehman said Credit Suisse's actions were "not commercially reasonable, not done in good faith and greatly inflated the amount of losses claimed."
Credit Suisse spokesman Drew Benson declined to comment.
The lawsuit seeks to reduce or void Credit Suisse's claims, and recover damages for alleged breach of contract.
Once Wall Street's fourth largest investment bank, Lehman filed for protection from creditors on September 15, 2008, and its bankruptcy remains by far the largest in U.S. history.
Lehman emerged from Chapter 11 in March 2012 under a plan that could eventually return $65 billion to creditors. The company is winding down, a process expected to take a few years.
The case is Lehman Brothers Holdings Inc et al v. Credit Suisse et al, U.S. Bankruptcy Court, Southern District of New York, No. 13-ap-01676. The main bankruptcy case is In re: Lehman Brothers Holdings Inc in the same court, No. 08-13555.
(Reporting by Jonathan Stempel in New York; Editing by Jeffrey Benkoe)
