(Reuters) – Credit Suisse can know who is behind a lawsuit accusing it of fraud in connection with the purchase of more than $100 million of notes, a London court ruled on Thursday.
The Swiss bank is seeking the information to bolster its argument that the case by Loreley Financing (Jersey) No 30 Ltd, one of a group of special purpose vehicles set up by German bank IKB, was brought too late. Loreley purchased the notes in 2007.
Lorely had said the information was privileged, but Judge Stephen Males ruled Thursday that, while privilege covers communications between clients and their lawyers, disclosing “the identity of the person communicating on behalf of the client would reveal nothing about the content of those communications”.
The judge said Loreley should provide an unredacted copy of a letter from its lawyers which reveals who is giving instructions to the law firm on Loreley’s behalf.
Credit Suisse declined to comment. Loreley could not be reached for comment.
The lawsuit was brought against Credit Suisse in November 2018 over the purchase of the notes, which was part of a collateralised debt obligation transaction, linked to the value of residential mortgage-backed securities, in the run-up to the 2008 financial crisis.
Lawyers for Credit Suisse told the Court of Appeal in London last month that knowing who may have made the decision to launch the litigation is critical to proving that the claims were brought too late.
The lawsuit alleges there was “underlying fraud” in relation to the securitisation of the notes, relying on Credit Suisse’s agreement in 2016 to pay a $2.48 billion penalty in a deal with the U.S. Department of Justice.
Both parties agree the lawsuit, which is due to go to trial next year, was brought outside the normal six-year time limit to bring claims that would usually begin when the notes were bought.
Loreley says it could not have discovered the alleged fraud before November 2012 and it could not have known about it until an agreed statement of facts was published by the DOJ in January 2017.
But Credit Suisse contends that German state-owned lender KfW – which rescued IKB in 2007 and is said by Credit Suisse to be directing the litigation – knew enough about any alleged wrongdoing to bring a claim before 2012.
The case is Loreley Financing (Jersey) No. 30 Limited v Credit Suisse Securities (Europe) Limited and others, CA-2022-001108.
For Loreley: Tim Lord and Fred Hobson of Brick Court Chambers, and RPC
For Credit Suisse: Tamara Oppenheimer and Adam Sher of Fountain Court Chambers, and Cahill Gordon & Reindel
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