Lehman Liquidator Fees Top a Quarter-Billion Dollars

Bankrupt Lehman Brothers Holdings Inc. accused Nomura Holdings Inc. of “egregious inflation” for seeking $2 billion to resolve claims in a series of derivatives deals and said the Japanese brokerage actually owes it money.

Lehman is fighting Nomura in two lawsuits and in a U.S. Bankruptcy Court dispute that it wants to consolidate in a single case. It says the Nomura claims stemming from guaranteed swap agreements are overstated by hundreds of millions of dollars, according to a court filing today in the Manhattan bankruptcy court.

“Those claims are premised on purported valuations and calculations that are commercially unreasonable, divorced from economic reality, and bear no relation to any actual damages or losses suffered by the Nomura entities,” Lehman said.

Lehman is trying to trim claims for payment, which originally totaled as much as $1 trillion, as it seeks court permission to reorganize.

The defunct investment bank said it seeks “redress against the Nomura Entities for their egregious inflation by, in some cases, hundreds of millions of dollars of the proofs of claim that the Nomura Entities filed under penalty of perjury.” Lehman said Nomura, based in Tokyo, filed duplicate claims against Lehman and an affiliate in bankruptcy court.

Peter Truell, a New York spokesman for Nomura, declined to comment.

Lehman said it wants to reduce the Nomura claims to zero, and asserted in court filings that two units of Nomura owe it an undisclosed amount.

Disputes With Creditors

Lehman, which has been trying to resolve disputes with creditors through mediation, said the lawsuits against Nomura were a last resort.

“We prefer to settle contracts at fair value via consensual agreement with cooperating counterparties, but will not hesitate to use the legal system when we deem it necessary based on the actions of our counterparties,” said Locke McMurray, head bankruptcy lawyer for derivatives at Lehman. The lawsuits show for the first time how Lehman values derivatives contracts, he said.

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

To contact the reporter on this story: Linda Sandler in New York at lsandler@bloomberg.net.

A file photo of Bryan Marsal, co-chief executive officer of Alvarez & Marsal. Source: Alvarez & Marsal via Bloomberg