Banking Law

8th Circuit Sides With Dorsey & Whitney in $900K Malpractice Case

After a decade of litigation, Dorsey & Whitney won a ruling (PDF) Thursday from the St. Louis-based 8th U.S. Circuit Court of Appeals that overturns earlier federal court judgments holding the law firm liable in a failed casino lending deal. Because the more than two dozen banks that sued the…

Jan 16, 2009 11:43 PM CST

Spanish Prosecutors Probe Bank’s $3.1B Client Losses to Madoff

Spanish prosecutors are investigating the loss of €2.3 billion ($3.1 billion) in funds invested with accused financier Bernard Madoff by Europe’s second-largest bank, Banco Santander. Santander invested money with Madoff for wealthy clients across Europe and Latin America, the Wall Street Journal reports (sub. req.). Investigators want to know more…

Jan 13, 2009 12:21 PM CST

Big Lender OKs Plan to Let Bankruptcy Judges Reduce Mortgage Balances

In a move that is expected to expedite proposed federal legislation permitting bankruptcy judges to reduce the principal balance on troubled mortgages on owner-occupied properties, a major bank is supporting a plan by Democratic lawmakers to enact such a law. Citigroup’s support for the legislation is expected to persuade other…

Jan 8, 2009 11:43 PM CST

Madoff Was About to Send $173M to Friends & Family, Prosecutors Contend

Upping the ante in an ongoing argument about whether bail should be revoked for Bernard Madoff, a prosecutor contends in a letter sent to federal court today that investigators found $173 million in checks in his desk that he was about to send to friends, family and employees. The accused…

Jan 8, 2009 6:56 PM CST

Heller Asserts Banks’ Clerical Error Cost Them $57M in Preferred Payments

Two lenders who contend Heller Ehrman still owes them nearly $6 million are fighting a contention that they no longer have a security stake in the law firm because of a mistaken 2007 filing under the Uniform Commercial Code. Heller has already paid the banks $51 million since announcing its…

Jan 6, 2009 12:56 PM CST

Banks Ask Law Firms for More Information, Charge More for Credit

Law firms are finding that credit is getting more expensive and subject to more restrictions. The changes come as many large law firms are borrowing more money and taking longer to pay it off, the American Lawyer reports. Bankers are nervous because law firms that have dissolved took on additional…

Jan 5, 2009 6:11 PM CST

Linklaters is Top ‘08 Euro M&A Advisor

Linklaters was the top dealmeister of 2008, advising on 249 announced European mergers and acquisitions including the year’s biggest: the purchase of beermaker Anheuser-Busch Cos.by InBev NV. The London-based magic circle law firm also was the top M&A adviser internationally, according to Bloomberg. In second and third place were two…

Jan 5, 2009 4:32 PM CST

‘Chaotic’ Lehman Bankruptcy Cost up to $75B in Value

An internal analysis concludes that Lehman Brothers lost up to $75 billion in value because of the hurried nature of its bankruptcy filing. The “unplanned and chaotic” filing led to cancellation of 900,000 separate derivatives contracts under provisions that called for contract terminations under an “event of default,” the Wall…

Jan 5, 2009 2:47 PM CST

How Lawyers Enabled The Meltdown

And how they might have prevented it

Jan 1, 2009 10:30 AM CST

Fairfield Hedge Fund Sued Over $7.5B Madoff Investment

Add another lawsuit to the growing list of litigation concerning the alleged $50 billion Ponzi scheme claimed to have been run by Bernard Madoff under the guise of a hedge fund. A complaint filed Friday in state court in New York alleges breach of fiduciary duty, negligence and unjust enrichment…

Dec 23, 2008 1:25 AM CST

FOX Files FOIA Suit to Get Treasury Info About $700B Bailout

FOX Business Network has sued the U.S. Treasury in federal court in New York, saying that the agency has stonewalled Freedom of Information Act requests for information concerning its expenditures under the $700 billion federal bailout bill. “The television network, a unit of News Corp., said in a release that…

Dec 18, 2008 8:54 PM CST

New Rules Limit Surprise Interest Hikes on Credit Cards

New credit card rules that will make it harder for banks to surprise consumers with sudden annual interest rate increases are being approved today by several federal agencies. The rules, which apparently specify that such increases constitute prohibited “unfair or deceptive” practices, also will require lenders to give consumers a…

Dec 18, 2008 6:13 PM CST

How Did Lawyers Enable the Meltdown?

In the game of blame that followed the deepest financial implosion since the Great Depression, bankers and money managers have borne their share of attention. But how much blame should lawyers bear? Plenty. As legislators, they helped remove restrictions on commercial banks that allowed them to get involved with subprime…

Dec 18, 2008 3:25 PM CST

FDIC to Pay Texas Financier $10M to Settle Legal Defense Claim

Ending a legal battle that began after the 1988 collapse of a Texas savings and loan indirectly controlled by financier Charles Hurwitz, the FDIC has agreed to pay him $10 million. The award is intended to cover his defense costs in earlier litigation involving both the thrift’s failure and, a…

Dec 17, 2008 9:40 PM CST

Dreier Founder Charged in ‘Brazen’ Alleged $100M Investment Fraud Attempt

The founder of the not quite 250-attorney Dreier law firm was charged today by federal prosecutors in Manhattan with securities and wire fraud, in connection with what an Securities and Exchange Commission official describes as an alleged “brazen” attempt to cheat three unnamed hedge funds out of $100 million. Marc…

Dec 8, 2008 8:09 PM CST