Lehman Preferred Series "J" Preferred (fka LEHJQ)

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Lehman’s Plan to Handle Claims Contrary to Law, Creditor Says

http://www.businessweek.com/news/2010-01-05/lehman-s-plan-to-handle-claims-contrary-to-law-creditor-says.html

January 05, 2010, 06:30 PM EST

By Linda Sandler

Jan. 5 (Bloomberg) -- Lehman Brothers Holdings Inc., which aims to trim $824 billion in claims filed by creditors, is asking the judge for powers that fly “in the face of” U.S. law and policy, said Bundesverband deutscher Banken, a German bank association, in a court filing today.

The defunct investment bank asked a U.S. bankruptcy judge to let it file so-called omnibus objections to certain claims, notifying creditors that the amounts sought contradict Lehman’s books and records, or aren’t Lehman’s obligations. With such powers, Lehman would avoid its “burden” to explain to each creditor why a claim is being rejected, the association said.

“Simply saying that the debtors’ books and records do not agree with, or that the debtors are not liable on, a particular filed claim, does not constitute evidence at all,” the association said in the filing.

While generalized objections to claims are allowed by bankruptcy rules in order to speed cases with large numbers of creditors, their use is restricted to protect claimants’ rights, the association said.

Lehman spokeswoman Kimberly Macleod didn’t immediately respond to an e-mail seeking comment.

Founded in Cologne, the association represents more than 220 private banks, according to its Web site.

Lehman filed the biggest U.S. bankruptcy with assets of $639 billion.

The case is In re Lehman Brothers Holdings Inc., 08-13555, U.S. Bankruptcy Court, Southern District of New York (Manhattan).