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Lehman June 9
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Ernst & Young Presses for Quick Win in Lehman Suit
Jun 8, 2015 | Dow Jones - Daily Bankruptcy Review
By Joseph Checkler
Accounting firm Ernst & Young LLP again pressed its case for a quick victory in a suit by Lehman Brothers investors over Ernst's auditing of the investment bank before it failed, saying there is no proof it made a false statement regarding Lehman. In a Friday filing with U.S. District Court in Manhattan seeking... -
E&Y Says Omnicare Dooms Opt-Out Suits In Lehman Litigation
Jun 8, 2015 | Law360
By Cara Salvatore
Ernst & Young LLP asked a New York federal judge Friday to dismiss two of the last remaining opt-out cases in multidistrict litigation over the failure of Lehman Brothers Holdings Inc., saying the auditing opinions E&Y provided more than met the applicable standard. -
Barclays (BCS) to Gain $750M from Lehman Settlement
Jun 8, 2015 | Nasdaq
Barclays PLC BCS and Lehman Brothers Holdings Inc have reportedly come to terms over an 8-year old dispute concerning the payment of Lehman's margin assets. Notably, Barclays is likely to record a pre-tax gain of $750 million from the settlement in its second-quarter results.
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Ernst & Young Presses for Quick Win in Lehman Suit
Jun 8, 2015 | Dow Jones - Daily Bankruptcy Review
By Joseph Checkler
Accounting firm Ernst & Young LLP again pressed its case for a quick victory in a suit by Lehman Brothers investors over Ernst's auditing of the investment bank before it failed, saying there is no proof it made a false statement regarding Lehman.
In a Friday filing with U.S. District Court in Manhattan seeking an immediate win on the parts of the suit that remain, Ernst said it would only be responsible for relying on Lehman's so-called Repo 105 accounting practices if it didn't believe what it said or knew it lacked a "reasonable basis" to say it....
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E&Y Says Omnicare Dooms Opt-Out Suits In Lehman Litigation
Jun 8, 2015 | Law360
By Cara Salvatore
Ernst & Young LLP asked a New York federal judge Friday to dismiss two of the last remaining opt-out cases in multidistrict litigation over the failure of Lehman Brothers Holdings Inc., saying the auditing opinions E&Y provided more than met the applicable standard.
Judge Kaplan had ordered briefing in early April on whether the Supreme Court's landmark Omnicare decision bears on fraud suits accusing E&Y of backing transactions that masked Lehman's fragile and deteriorating financial state.
The Omnicare ruling, which held that a false opinion doesn't confer liability on an auditor unless it can be shown the auditor knew of its falsity, could entitle Ernst & Young to summary judgment against plaintiffs who opted out of a previous settlement. But the accounting firm told U.S. District Judge Lewis A. Kaplan on Friday that with respect to suits by Arthur N. Abbey and Starr International USA Investments LLC, Omnicare didn't change matters.
“Plaintiffs’ claims fail because they do not and cannot show that EY disbelieved its opinions or knew it had no reasonable basis for them,” E&Y said.
The firm, which audited Lehman's financial statements, reviewed the company’s quarterly financial results and provided written reports on its internal controls.
Meanwhile, in May, E&Y told Judge Kaplan it settled allegations by American National Insurance Co. of Texas and certain of its affiliates that they lost over $21 million because of Lehman's subprime exposure. The firm said in a letter that the firm had reached an agreement in principle with American National Insurance Co. of Texas, Comprehensive Investment Services Inc. and the Moody Foundation after mediation...For full story:
http://www.law360.com/articles/664820/e-y-says-omnicare-dooms-opt-out-suits-in-lehman-litigation
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Barclays (BCS) to Gain $750M from Lehman Settlement
Jun 8, 2015 | Nasdaq
Barclays PLC BCS and Lehman Brothers Holdings Inc have reportedly come to terms over an 8-year old dispute concerning the payment of Lehman's margin assets. Notably, Barclays is likely to record a pre-tax gain of $750 million from the settlement in its second-quarter results.
The long-running dispute centered upon Lehman's margin accounts that arose when Barclays purchased the latter's brokerage unit back in 2008. While Barclays claimed to have purchased the concerned accounts as part of the transaction, along with other brokered assets from Lehman; the latter argued that such accounts were cash, and hence, part of the company's total estate.
On Friday, James W. Giddens, the trustee in charge of the unwinding of Lehman's brokerage unit, announced that Lehman will shell out $1.28 billion, resolving all disputes. However, both Barclays and Lehman agreed that the total payment is short by $80 million relative to what Giddens would have paid, had the settlement not taken place. Also, nearly $255 million related to exchange-traded derivatives is expected from third parties.
Further, as part of the filing with U.S Bankruptcy Court in Manhattan, both parties have agreed to drop current as well as prospective charges against each other. The deal is, however, yet to receive approval from U.S Bankruptcy Judge, Shelly Chapman.
Besides Barclays' above-mentioned pre-tax gain, the deal is predicted to free cash worth $600 million for payment to Lehman's creditors, as the company had initially maintained a litigation reserve of roughly $1.87 billion. Based on sources, Giddens has returned nearly $112 billion to Lehman's creditors and customers till date.
Jonathan Schiller of Boies Schiller & Flexner LLP, Barclays' lawyer in the dispute said that "Barclays fought hard and responsibly through six years of litigation to secure approximately $8 billion of purchased yet disputed assets, and today's settlement brings that effort to a successful completion,"...For full story:
http://www.nasdaq.com/article/barclays-bcs-to-gain-750m-from-lehman-settlement-analyst-blog-cm484683
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