2nd Circ. Says German Bank Can Bring $60M CDO Suit

Law360, New York (August 6, 2012, 5:08 PM EDT) -- The Second Circuit on Monday resurrected Bayerische Landesbank's claims that a hedge fund mismanaged its doomed $60 million investment in a collateralized debt obligation, ruling the bank could try to recover its losses under a contract created by the hedge fund and underwriter Goldman Sachs Group Inc.

BayernLB sued Aladdin Capital in January 2011 for breach of contract and gross negligence, saying the hedge fund ignored its duties to its investors and allowed the bank's investment in a synthetic CDO to evaporate. The bank's investment, a...
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