Judge Tells BofA To Return $500M To Lehman Bros.

Law360, New York (November 16, 2010, 7:19 PM EST) -- A bankruptcy judge ruled Tuesday that Bank of America NA has to give back more than $500 million that Lehman Brothers Holdings Inc. deposited just weeks before seeking Chapter 11 protection, and called the bank's seizure of the funds an impermissible setoff that violated the automatic stay in Lehman's bankruptcy case.

Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York signed off on a 46-page decision granting LBHI and Lehman Brothers Special Financing Inc.'s bid for summary judgment, and holding...
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