The recent financial fallout among the major banks could spur increases in litigation. Private sector buys bad debts.
Fort Worth, TX (WiredPRNews.com)—Attorneys in Northern New Jersey could see an increase in corporate litigation business financial institutions seek legal remedies.
According to a September 29, 2008 NJBIZ.com article by Martin C. Daks, some law firms have seen an increase in bankruptcy and commercial litigation cases since the Lehman Brothers collapse earlier this year. The article indicated that a similar wave of business lawsuits happened in the 1980s and 1990s when financial institutions went through similar problems.
Lehman Brothers, which was not bailed out by the government like AIG, Freddie Mac and Fannie Mae were, now has a stock price worth about 15 cents, according to a September 29, 2008 USA Today article by Matt Krantz, after falling from their high mark of $84 in January of 2007.
The USA Today article states that when a company like Lehman goes into bankruptcy court, the stockholders usually end up with investments worth next to nothing. Lehman has already been kicked off the New York Stock Exchange, according to Krantz.
But there may be hope on the horizon for Lehman as Boston-based Bain Capital LLC and Hellman and Friedman LLC have agreed to purchase most of Lehman’s asset-management group, according to a non-bylined September 30, 2008 Bloomberg News article that appeared in Boston.com. The buyout, if approved by a federal bankruptcy court, will cost just over $2 billion.
The investment banking side of Lehman now belongs to London-based Barclay’s PLC, according to the Bloomberg News article, which finished its purchase of the 158-year-old firm last week.