The U.K.'s top litigators are predicting a surge of litigation in the aftermath of the Lehman Brothers collapse.
Law firms are already receiving calls from clients asking about their positions in the wake of Lehman's bankruptcy filing earlier this week.
The impact is already going beyond potential claims against Lehman, its management and advisers and by the bank as it pursues third party advisers for the benefit of its creditors.
Lehman's demise is also expected to kick off claims by unrelated parties such as investment banks and hedge funds considering their positions on funding obligations given the broader credit market turmoil.
CMS Cameron McKenna litigation partner Guy Pendell told Legal Week: "Where parties stand to lose significantly there is the potential for litigation but Lehman will not necessarily be the target of claims. Parties may look elsewhere to recover losses and professional advisers can be a target in these circumstances."
Mayer Brown litigation partner Clare Canning added: "Litigation kicks off when people run out of cash. You could not have a more dramatic example of that here."
The Financial Services Authority has already asked British banks to report their exposure to Lehman and banks including Lloyds and Standard Chartered are among those thought to be owed money by the bank. There could also be claims from ex-employees seeking compensation for not being paid their wages.
David Greene, head of litigation at
He added: "If ex-employees do not get paid there is a large body of them who could collect together to bring action. Creditors of BCCI included ex-employees."
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