UK court throws out Lehman case on CSO collateral

A UK court today threw out an appeal by Lehman Brothers in a legal dispute over whether collateral backing several synthetic CDOs should be paid to investors or treated as part of Lehman’s bankruptcy estate

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TAGS: Law suits

Comment by: Anonymous. Posted 14 years ago [2009-11-08 21:19:01]

The judgement is however significant in that it lays out firmly the position of the UK courts on this matter. If the US courts decide in a different manner it will throw the whole securitisation industry into pandemonium as juristictional arbitrage witll be created that can be generalised way beyond CSO's to swaps in general. The US courts will be aware of this and a weak or contradictory judgement on their part will likely see business flood to London and investor's favour swap counterparties with no US connections.