Lehman Unit Sues MetWest Over $17M Setoff

Law360, New York (May 18, 2009, 12:00 AM EDT) -- A bankrupt subsidiary of Lehman Brothers Holdings Inc. has filed a $17 million adversary lawsuit against Metropolitan West Asset Management LLC, claiming the defendant failed to pay its obligations under a swap deal.

Lehman Brothers Special Financing Inc.'s lawsuit, filed Friday in the U.S. Bankruptcy Court for the Southern District of New York, says the defendants have paid about $22 million under the terms of a 2004 agreement but, despite acknowledging the debtor's entitlement to the remaining money, have withheld payment.

The basis for withholding the...
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