Lehman Judge Fumes At RMBS Trusts' Distribution Moves
April 19, 2018
Trustees for investors who bought toxic residential mortgage-backed securities from Lehman Brothers Holdings Inc. before the 2008 financial crisis got an earful Thursday from a New York bankruptcy judge who fumed that their concerns over how to distribute funds from a $2.4 billion settlement could have been raised months ago.
The hearing Thursday was put in motion by a group of institutional investors that want any matters regarding the distribution of their shared recoveries from the Lehman estate to take place in U.S. Bankruptcy Judge Shelley C. Chapman's court.
“As you can tell, I’m quite unhappy that we have to deal with this issue,” Judge Chapman said.
The settlement amount at issue was decided in March after a trial-like claims estimation proceeding. Under the arranged deal, Lehman’s bankruptcy plan administrator agreed to seek estimation and allowance of $2.4 billion, and the trustees received the chance to fight for a higher amou.
During the proceedings, the trustees contended that there’s strong evidence that Lehman repeatedly breached its contracts on tens of thousands of misrepresented home loans, entitling them to a claim of approximately $11.4 billion.
But Judge Chapman ultimately found that the claims brought over the toxic securities were appropriately valued at around $2.38 billion.
The trustees are represented by Alston & Bird LLP, Mayer Brown LLP, Morgan Lewis & Bockius LLP, Faegre Baker Daniels and Hahn & Hessen LLP.
La richiesta è stata valutata dal giudice Chapman come un tentativo di rimettere in discussione l'accordo raggiunto a Marzo 2018.
Lehman Judge Fumes At RMBS Trusts' Distribution Moves - Law360