Lehman vs Moore in swaps safe harbour showdown

Lehman Brothers is claiming a series of inter-affiliate transfers by Moore Capital robbed it of $20 million of derivatives termination payments at the time of the bank’s collapse. The resulting test of the US bankruptcy code has profound implications for swaps

Lehman Brothers: lawyers claim Moore Capital misused safe harbour

Seven years after its bankruptcy filing, Lehman Brothers has the potential to again upend the derivatives market – this time, by weakening one of its legal cornerstones, the right to immediately net and settle trades with a defaulted counterparty, rather than waiting in line during the bankruptcy process.

Lawyers for Lehman's estate claim New York-based hedge fund Moore Capital misused this safe harbour – part of the US bankruptcy code – in 2008 to cut $20 million from the sum it owed the bank

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here