Highland Crusader Asks Court to Reject UBS $686 Million Suit
January 17, 2012, 5:00 PM ESTBy Chris Dolmetsch
(Updates with excerpt from filing in fourth paragraph.)
Jan. 17 (Bloomberg) -- Highland Crusader Holding Corp. asked a New York state court to dismiss a lawsuit filed by UBS AG seeking damages of more than $686 million for alleged fraudulent conveyances and tortious interference.
UBS, Switzerland’s biggest lender, sued Highland Crusader in New York State Supreme Court in Manhattan in September, claiming the hedge fund “fraudulently induced” the bank to restructure a collateralized debt obligation transaction in 2008.
Most of the lawsuit is a “rote regurgitation” of claims that have been raised in the past against the fund’s parent, Highland Capital Management LP, and dismissed, Highland Crusader said in court documents filed yesterday.
“Here we go again,” Highland Crusader said in the filing. The company called the Zurich-based bank’s complaint “yet another fatally flawed attempt to impose contractual liability on a Highland Capital Management LP managed third party based on flimsy allegations and dismissed claims.”
Highland Capital, founded by James Dondero and Mark Okada in Dallas in 1993, announced plans in October 2008 to close its flagship Crusader Fund and the Highland Credit Strategies Fund over a three-year period after suffering losses on high-yield, high-risk loans and other types of debt.
The UBS communications office didn’t immediately respond to an e-mail seeking comment on the filing.
The case is UBS Securities LLC v. Highland Crusader Holding Corp., 652646/2011, New York State Supreme Court (Manhattan).
--Editors: Andrew Dunn, Stephen Farr
To contact the reporter on this story: Chris Dolmetsch in New York at cdolmetsch@bloomberg.net.
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.
