| April 3
April 3 Lehman Brothers Holding Inc has slashed
billions of dollars of claims made by a former Swiss derivatives
unit as details of the agreement were presented in a court
Lehman Brothers emerged from bankruptcy a year ago but it is
still working to resolve several outstanding legal battles. The
agreement with Switzerland-based Lehman Brothers Finance AG, or
LBF, was the last major dispute to be settled, according to
Daniel Ehrmann, Lehman Brother Holding's international chief.
"This settlement avoids years of potentially costly
litigation and allows LBF to significantly accelerate its
distributions to creditors while providing LBHI with a
significant recovery," said Ehrmann in a statement.
The agreement was announced last week, but details were not
disclosed until a Tuesday filing with the U.S. Bankruptcy Court
LBF agreed to cuts its claim against Lehman Brothers Holding
to $942 million from $15.4 billion, according to court papers.
LBF also assigned to Lehman Brothers Holding billions of dollars
of claims that LBF asserted against certain Lehman affiliates.
In return, Lehman Brothers Holding cut its claim against the
Swiss business to $8.75 billion from an original claim of $14.2
billion. The holding company also agreed to partially
subordinate its claim against LBF to the claims of LBF's
third-party and affiliate creditors.
The U.S. Bankruptcy Court in Manhattan must approved the
deal. A hearing has been requested for April 24.
Once Wall Street's fourth-largest investment bank, Lehman
filed for bankruptcy protection on Sept. 15, 2008, in what was a
major trigger for that year's global financial crisis.
The company reported $639 billion of assets at the time,
making the bankruptcy by far the largest in U.S. history.
The company plans to distribute $14.2 billion to creditors
on Thursday, its third distribution since it emerged from
bankruptcy on March 6, 2012. The payout will bring total
distributions to $47.2 billion.
The case is: In re: Lehman Brothers Holdings Inc, U.S.
Bankruptcy Court, Southern District of New York, No. 08-13555.