LONDON (Reuters) -Credit Suisse's $440 million London lawsuit against Japan's SoftBank Group Corp kicked off on Thursday over losses linked to Greensill Capital, with the collapsed finance firm's
Credit Suisse and SoftBank Clash in $440 Million Greensill Lawsuit
LONDON (Reuters) -Credit Suisse's $440 million London lawsuit against Japan's SoftBank Group Corp kicked off on Thursday over losses linked to Greensill Capital, with the collapsed finance firm's founder Lex Greensill expected to give evidence next week.
The case, which centres on funds Greensill lent to Katerra, a SoftBank-backed U.S. construction group, is the latest concerning Greensill's demise, which caused heavy losses for investors and prompted lawsuits and regulatory probes.
Greensill's collapse made Credit Suisse close $10 billion of funds linked to the financial firm and, along with other scandals, led to the 2023 state-backed rescue of the 167-year-old Swiss bank by rival UBS Group.
UBS is now pursuing the case against SoftBank, with Lex Greensill and Eric Varvel, former chairman of Credit Suisse's investment bank, among the key witnesses at the trial.
The lender alleges that Greensill, at SoftBank's behest, gave up rights to Katerra's debts in return for shares which it then passed on to a SoftBank Group entity, leaving Credit Suisse out of pocket in relation to $440 million of notes.
Lawyer Sonia Tolaney, representing the Credit Suisse fund that held the notes, said SoftBank was heavily exposed to both Greensill and Katerra, to a total of around $3.5 billion, and "needed to protect the value of its investments".
SoftBank, however, says the lawsuit lacks merit and is simply an attempt by Credit Suisse to "pin blame (on SoftBank) for a loss caused by their own negligence and risk-taking".
Tom Smith, a lawyer for SoftBank, said in court filings that SoftBank paid $440 million to Greensill "on the agreement and understanding that this was to be used to repurchase or redeem" the notes and pay back Credit Suisse in full.
"Far from seeking to harm (Credit Suisse), the (SoftBank defendants) and (Lex Greensill) acted to protect (Credit Suisse) because of its importance to Greensill's business model," he said.
(Reporting by Sam TobinEditing by Tomasz Janowski)
