UBS Hit by Another Lawsuit

Hedge fund Pursuit Partners accuses the bank of marketing CDOs as investment grade that it knew were about to be downgraded by Moody's

Swiss bank UBS, already smarting from one investor lawsuit, is facing allegations from a hedge fund that it marketed securities as investment grade that the bank knew were destined for junk status. Pursuit Partners, a Stamford (Conn.)-based hedge fund, claims in a Mar. 5 lawsuit that it bought collateralized debt obligations, or CDOs, from UBS last year based on "fraudulent concealment" of material information.

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