Yesterday, the Depository Trust & Clearing Corporation (DTCC) announced that its Trade Information Warehouse (TIW) successfully completed on October 21st settlement of the over-the-counter credit default swaps (CDS) related to the credit event of Lehman Brothers Holdings Inc.

The taxpayer was able to convince the court that the creditors who got the stock in the reorganization were not the prior owners. Because the events occurred in 1992, under a prior version of the continuity of proprietary interest rules, continuity of ownership was broken and a section 338(h)(10) election could be made and the basis in the assets inside the corporation stepped up to fair market value, with no tax liability because the seller was in bankruptcy with large net operating losses (NOLs).

Yesterday afternoon, the House Judiciary Committee held Part II of its series of hearings entitled “Too Big to Fail – the Role for Bankruptcy and Antitrust Law in Financial Regulation Reform.” Yesterday’s hearing focused on proposed financia

As the federal government and private markets make progress to quell economic recession and stimulate the engines of financial growth, recent headlines from the commercial real estate industry have focused on certain developments, such as the proposed changes in rating agency methodologies and the repeated false starts with the government’s TALF and PPIP programs.

Over the past several weeks, several additional Lehman Brothers affiliate entities filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York. For procedural purposes, these bankruptcy petitions will be jointly administered along with the petition filed by Lehman Brothers Holdings, Inc., the lead debtor. These entities include:

Yesterday, the United Kingdom’s Commercial Secretary to the Treasury launched a consultation on a new special-resolution regime, Special administration regime for investment firms, to strengthen the government’s ability to handle future insolvencies of failing investment banks to minimize cost and disruption of the overall national financial system.

Yesterday, the bankrupt estate of Lehman Brothers Holdings, Inc. (Lehman) sued Barclays Capital, Inc.

Late Sunday night, U.S. Bankruptcy Judge Arthur Gonzalez approved the sale of most of Chrysler's assets to Italian Automaker Fiat S.p.A., as contemplated in the Master Transaction Agreement between the two companies.

On Tuesday, the FDIC held the first in a series of proposed roundtable discussions on the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which is intended to bring transparency to the rulemaking process. Government officials, industry executives, academics and investors were invited to participate in the discussion.

Yesterday, FDIC Chairman Sheila Bair, the keynote speaker at the Institute of International Bankers Cross-Border Insolvency Issues Conference in New York, stressed the need to end the “too big to fail” mentality by “eliminating the belief that the government will always support large, interconnected financial firms.” Chairman Bair noted that in order to do so, “we need an effective mechanism to close large, financial intermediaries when they get into trouble.”