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Lehman UK arm set to sue for $100bn

Administrators for Lehman Brothers London arm are preparing a $100bn law suit against its former US parent.

PricewaterhouseCoopers is finalising the claim, which is set to be filed in the next few weeks.

A statement from the PwC says the parent company, Lehman Brothers Holding Inc, and its various USA subsidiaries that are in Chapter 11, have all established a deadline for claims to be submitted in the next few weeks.

It says: “We’re dealing with a large number of entities and therefore the claims could be as much as $100 billion. These claims are exceptionally complex and we anticipate a large amount of further work in dealing with these claims. This is a normal part of the bankruptcy claims formulation and submission process. A significant number of claims arise as a result of guarantees issued by the parent company to its subsidiaries globally.

“We have invested a significant amount of time helping administrators in other affiliates understand the Lehman accounting systems so that we can all agree a standard approach to the reconciliation of inter company balances. If this can be achieved then it should reduce the likelihood of affiliates suing each other in pursuit of amounts that are owed between the different Lehman estates.”

Lehman owed $613bn when it collapsed last September with liquidators working through the business to repay creditors and collect money owed. The US bankruptcy court has set a deadline of September 22, 2009, for all creditors to file their claims.

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