Credit Suisse Takeover Fallout: Lawsuits Persist After Swiss Court Dismissal
The legal fallout from Credit Suisse's takeover by UBS continues, with multiple lawsuits dismissed and ongoing. The Federal Supreme Court recently threw out the second such case, while others persist in Swiss and U.S. courts.
The most recent dismissal by Switzerland's highest court involved AT1 bondholders suing the Swiss Financial Market Supervisory Authority (FINMA) and the state. These investors, holding around 16 billion CHF worth of bonds, argue that FINMA's order to write off their investments was unlawful. They seek billions in damages or the reversal of FINMA's decision.
Meanwhile, over 5,000 former Credit Suisse shareholders are suing UBS in Zurich, alleging the takeover was too cheap. On the day of the takeover, UBS paid just 3 billion Swiss francs, or 76 cents per share. Around 320 complaints from about 3,000 AT1 creditors, including the Migros pension fund, are also suing FINMA and the state in Switzerland. In the U.S., a lawsuit against Swiss authorities was dismissed due to Switzerland's immunity from U.S. jurisdiction. The process is complex, involving several partial proceedings and ongoing legal battles.
The Credit Suisse-UBS merger continues to spark legal disputes, with lawsuits demanding billions in damages or the reversal of FINMA's decision to write off AT1 bonds. While some cases have been dismissed, others remain active in Swiss and U.S. courts, reflecting the complex and far-reaching implications of the takeover.
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