Lehman Unit Sues To Halt $137M Payout In CDS Deal

Law360, New York (February 4, 2009, 12:00 AM EST) -- Lehman Brothers Special Financing Inc. has accused its partner in a credit default swap agreement of seeking to avoid paying the bankrupt company $400 million it allegedly owes under the arrangement by claiming that the Lehman unit defaulted on the agreement when its parent company filed bankruptcy proceedings.

The adversary complaint, filed Tuesday in the U.S. Bankruptcy Court for the Southern District of New York, is seeking to bar Wells Fargo Bank NA, as trustee to the credit default swap, from distributing the $137 million remaining...
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