- CDO Litigation
- Structured Finance Litigation
- Syndication and Securitization Litigation Syndication and Securitization Litigation
- Bankruptcy Litigation
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In a global economy with constantly evolving capital markets, institutional investors need to know their rights and how to protect their investments. Lowenstein Sandler's Capital Markets Litigation practice has a unique breadth of experience representing financial institutions, both domestic and foreign, hedge funds, commercial creditors and an array of other institutional investors. We move swiftly and proactively, always recognizing the economic drivers underlying civil disputes.
Our attorneys have successfully litigated cases involving virtually all types of capital markets transactions, including collateralized debt obligations (CDOs) and other forms of securitizations, asset-backed securities and structured finance vehicles, syndicated bank loans, credit default swaps and other derivatives, loan correspondent agreements, "repo" agreements and prime brokerage agreements. We also work in tandem with the firm's Bankruptcy Department to take aggressive action in bankruptcy and insolvency proceedings when litigation is the appropriate strategy.
CDO and Structured Finance Litigation
The subprime mortgage crisis of 2007 triggered a series of unprecedented events that reverberated throughout the global economy. While the meltdown came as a surprise to many, our experience in this area long predates the current market upheaval. For years we have represented CDO sponsors, collateral managers, and equity and debt investors in disputes ranging from the warehousing of CDO assets to underwriter fraud. We have a well-developed network of CDO experts - pioneers in the structured finance profession - who are instrumental in effectively litigating any type of structured finance dispute. Our attorneys are also frequent panel members at industry events concerning CDO diligence and CDO litigation.
Our representative structured finance experience includes:
Winning dismissal of a $1.875 billion claim brought in New York by financial guarantor FGIC against client IKB Deutsche Industriebank. FGIC was attempting to rescind a financial commitment issued in the United Kingdom as loss protection to a structured vehicle; the matter involved a complex array of credit default swaps and underlying CDO assets.
Representation of equity sponsors and collateral manager in claims against a global investment bank stemming from three contemplated CDOs, totaling $1.5 billion; we defeated claims brought by the investment bank before the International Centre for Dispute Resolution, which cleared the way for the successful prosecution of damages claims in the New York courts.
Prosecution of claims in New York on behalf of equity sponsors and collateral manager against a global investment bank, arising from two contemplated CDOs, each in the amount of $750 million.
Investigation of claims on behalf of investors in multiple subprime CDOs regarding the conduct of deal participants.
Prosecution of fraud and unsuitability claims relating to auction-rate securities and CDO investments, through a FINRA/NASD arbitration by a publicly traded foreign investor against a global investment bank.
Representation of CDO noteholders regarding the collateral manager's and trustee's interpretation of the Indenture's waterfall provision.
Syndication and Securitization Litigation
We represent investors and financial institutions in disputes arising from securitizations and syndicated loans in a variety of asset classes and industries. Our experience ranges from fraud claims in residential mortgage securitizations to disputes involving put-backs and warranties on consumer credit card debt pools, as well as claims by participants in syndicated commercial loans and distressed real estate transactions. Our attorneys were among the first to prosecute claims against a global investment bank relating to the structure and modeling assumptions used for the securitization of residential mortgages.
Investors with distressed debt and equity positions need seasoned and sophisticated litigation counsel to pursue their rights in the bankruptcy courts. Lowenstein Sandler’s Bankruptcy Department is ranked among the finest in the nation. Our Capital Markets Litigation practice works closely with our bankruptcy lawyers to perfect our clients’ strategies and maximize recoveries. We have served as lead trial counsel for the official creditors' committees in some of the country’s largest bankruptcy cases.
Our representative bankruptcy litigation experience includes:
- Lead litigation counsel for the creditors' committee in In re: Interstate Bakeries Corporation, the Chapter 11 bankruptcy of the exclusive manufacturer of iconic brands such as Hostess®, Wonder Bread® and Twinkees®.
- Special litigation counsel for the creditors' committee in In re: Fedders North America, Inc., the Chapter 11 bankruptcy of one of the most prominent U.S. manufacturers of air conditioners.