Lehman Brothers Financial SA (LEHNQ)

[cottonisking]

It is lawful for a Barclay's distribution to LBHI's Plan Trust:

Whether Barclays could make a distribution to LBHI's plan trust is dependent on a legal settlement and is not guaranteed. While there are similarities between Barclays' potential situation and JPMCB's settlement, key differences exist, and any distribution would depend on the specific terms of a potential agreement between Barclays and the LBHI estate.
Similarities to the JPMCB distribution
A distribution from Barclays would resemble the JPMCB distribution in the following ways:
Settlement of outstanding litigation: JPMCB's payments were the result of a settlement over claims that JPMorgan improperly extracted billions in collateral from Lehman before its 2008 bankruptcy. Similarly, Barclays settled its own litigation with the Lehman estate over the assets and liabilities in the 2008 sale of Lehman's U.S. brokerage business.
Payment to the Plan Trust: As with the JPMCB settlement, any payment from Barclays resulting from litigation related to the LBHI estate would likely be directed to the LBHI Plan Trust. This trust was established to collect and distribute funds for the benefit of former stockholders.
Post-discharge payment: A settlement payment from Barclays would be a post-discharge payment. A bankruptcy discharge prohibits creditors from pursuing further action on discharged debts, but it does not prevent a third party from settling new claims with the estate.
Differences from the JPMCB distribution
Potential differences that could affect a Barclays distribution include:
Finality of previous settlement: Unlike the JPMCB settlement, which involved a series of payments totaling over $2 billion, Barclays settled its litigation with the Lehman Trustee in 2015. This settlement covered all outstanding issues and could indicate a more complete resolution that leaves no basis for additional distributions.
Source of the claim: The specific nature of the litigation is different. The JPMCB litigation centered on claims of improper collateral transfers, whereas the Barclays litigation focused on the valuation and transfer of assets during the 2008 sale of Lehman's brokerage business. Whether the Barclays settlement left open any avenue for future claims or distributions would depend on its specific terms.
Beneficiaries: Any distribution would be made according to the terms of the existing plan trust. As with the JPMCB distribution, the discharged Class 10B claims would not be able to receive payment from a new distribution.
Conclusion
Barclays could potentially make a distribution to the LBHI Plan Trust if a future legal settlement or agreement requires it. However, the 2015 settlement between Barclays and the Lehman Trustee largely resolved the disputes over the 2008 sale. Absent new litigation or a voluntary payment, it is not guaranteed that a distribution similar to JPMCB's would occur.