FRANKFURT Jan 17 (Reuters) - Germany's Federal Court of Justice has ruled that investors can sue Standard & Poor's for failing to adequately reflect the deteriorating financial health of Lehman Bros in its rating assessment shortly before the bank became insolvent.
The court admitted a case brought by Juergen Hillebrand, a German pensioner who bought a Lehman investment note called an "Alpha Express Zertifikat", a product whose performance was tied to Lehman's credit risk, his lawyer Jens-Peter Gieschen at law firm KWAG in Bremen, Germany, said on Thursday.
It's the first time a German court has admitted a case brought by retail investors against rating agencies, potentially opening the door to further claims.
S&P, part of McGraw-Hill Cos Inc , failed in its duty to make a credible ratings assessment because the notes were given a good score only days before the Lehman insolvency in September 2008, Gieschen said.
A spokeswoman for S&P in Germany said: "We believe that these claims are without merit."
One of the reasons Hillebrand bought 30,000 euros ($40,100)worth of the Lehman notes in May 2008 was the fact that they were rated A+, giving him the impression it was a conservative investment, Gieschen said.
Nikolaus Boemcke, a Munich-based attorney specialised in capital markets litigation with law firm Roessner, said: "With this decision the court has opened a new way to help Lehman victims."
The Federal Court decision dates from Dec. 13, 2012 and was communicated to Hillebrand on Jan. 14, Gieschen said.