• Lehman Swaps: Too Late to Terminate?
  • October 16, 2009 | Authors: Thomas S. Marrion; Stephen E. Weyl
  • Law Firms: Hinckley, Allen & Snyder LLP - Hartford Office; Hinckley, Allen & Snyder LLP - Concord Office
  • Since the commencement of bankruptcy proceedings by Lehman Brothers Holdings, Inc. ("Holdings") in September 2008 and by Lehman Brothers Special Financing, Inc. ("LBSF" and, with Holdings, "Lehman") a few weeks thereafter, counterparties have wrestled with whether to cease or continue making swap payments, whether (and when) to terminate their swaps and what, if any, counterparty(ies) might take over and continue their swaps during or at the termination of the bankruptcy. Given the unprecedented nature of the Lehman bankruptcy, there have been no easy or clear answers to these questions. However, as the bankruptcy proceedings enter their second year, some of these issues are being addressed.