On January 25, 2010, the United States Bankruptcy Court for the Southern District of New York entered an order granting summary judgment in favor of Lehman Brothers in a dispute involving so-called “flip clauses” contained in collateralized debt obligation transactions. Prior to the US Bankruptcy Court’s decision, the English Court of Appeal had also considered the enforceability of flip provisions in the context of the same transaction. In a judgment rendered on November 6, 2009, the English court had arrived at the opposite conclusion. This Client Publication considers the conflicting judgments and the implications for cross-border financial and other contracts.
View full memo, "Lehman Brothers: Ipso facto clauses and the anti-deprivation rule—US and English Courts speak a different language"