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MF Global Trustee Sues Breakwater Trading for Alleged Breach

The MF Global Holdings Ltd. trustee sued Breakwater Trading for allegedly breaching a credit agreement and seeks about $8.3 million plus interest, according to a court filing.

On Sept. 14, written demand was sent to Breakwater pursuant to the agreement, MF Global’s Chapter 11 trustee, Louis Freeh, said in court papers filed today in U.S. Bankruptcy Court in Manhattan. “Breakwater, however, has refused to comply with its clear contractual obligation to repay the money it borrowed,” Freeh said.

MF Global Holdings, once run by former New Jersey Governor and Goldman Sachs Group Inc. (GS) Co-Chairman Jon Corzine, filed the eighth-largest U.S. bankruptcy after a wrong-way $6.3 billion trade on its own behalf on bonds of some of Europe’s most indebted nations.

MF Global Holdings’ Oct. 31 bankruptcy filing listed assets of $41 billion and debt of $39.7 billion.

The parent’s bankruptcy case is MF Global Holdings Ltd., 11-bk-15059, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Dawn McCarty in Wilmington at dmccarty@bloomberg.net

To contact the editors responsible for this story: John Pickering at jpickering@bloomberg.net.

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