Publicly-listed litigation funder, IMF Australia has announced it will be funding legal action by local councils against the owner of ratings house, Standard & Poor's — McGraw-Hill – for the ratings applied to the collateralised debt obligations (CDOs) distributed by Lehman Brothers.
IMF has announced to the Australian Securities Exchange (ASX) today that the action was a follow-on from the liquidators of Lehman having proposed a Scheme of Company Arrangement where admitted creditors may receive between 39.9 cents and 49.2 cents in the dollar.
It said the investors' claims against Standard & Poor's would be for the balance of their losses after receipt of any monies from Lehman plus interest.
It said the litigation would be commenced by Moree Plains Shire council and city of Swan each on their own behalf as a representative of other investors.
