Headlines

More than $3 billion can be paid back to hedge fund clients of Lehman Brothers, a London judge ruled on Wednesday, the latest in a string of court cases triggered by the investment bank's failure, Reuters reported. Administrators of Lehman Brothers' London operations, PricewaterhouseCoopers, asked the London high court for a ruling on how to treat cash raised after Lehman collapsed.

Canadians are being urged to pay close attention to the plight of workers from bankrupt Nortel Networks Corp. because it could some day be their own story, The Toronto Star reported. With many company pension plans across the country underfunded, workers could easily see their pensions and other benefits reduced dramatically or disappear if their employer closes the doors for good. Ken Georgetti, president of the Canadian Labour Congress, predicted that pension and benefit protections will be front and centre in the next federal election.

The administrator of Australia's largest offshore abalone producer, Australian Bight Abalone, says growers will take over the company within months, ABC News reported. The company went into voluntary administration in July. Creditors yesterday voted for a recapitalisation plan which will see growers become shareholders in the farms near Elliston on South Australia's west coast. Administrator Sam Davies says the deal is a win for all stakeholders.

A plan by Germany's incoming government to cut taxes while shifting tens of billions of euros in social spending outside the regular budget was attacked by business groups, economists and political opponents as an accounting trick, The Wall Street Journal reported. A draft agreement between Chancellor Angela Merkel's conservatives and their new partners, the business-friendly Free Democratic Party, envisages a "special fund," separated from the main federal budget, to cover some of the financial shortfalls in Germany's welfare state. The maneuver could help Ms.

France Telecom said on Tuesday it would put off any restructuring of sites or offices in France until the end of the year, meeting a demand from labour unions, Reuters reported. The telecom operator has suffered a series of suicides among its workers that has seen 25 people take their own lives since the beginning of 2008. Labour unions blame ongoing cost-cutting and restructuring for creating poor working conditions that are pushing some workers to the edge.

Tiverton-based Devon Cider has gone into administration, Off Licence News reported. Vantis Business Recovery Services has been appointed as administrator for the cidermaker, which produces own-label ciders and brands including Old Moors, Three Hammers and Ice White. Geoff Rowley, client partner at Vantis, said: “We are continuing to trade with all of Devon Cider’s customers and have the on-going support of all the multiples with whom Devon trades.

German postal services company Deutsche Post has not yet benefited from the recent economic upswing, its chief executive said on Wednesday, after rivals made upbeat noises about market improvement, Reuters reported. "So far, we can't see this in the results for July and August," Deutsche Post CEO Frank Appel said. Appel added that Deutsche Post would take a hit in the third quarter from the closure of German mail-order company Quelle, one of Deutsche Post's major customers. Read more.

Major UK firms including Pinsent Masons and CMS Cameron McKenna are among the growing rank of firms either holding back or reducing partner profit distributions as a result of the recession, Legal Week reported. Top 15 firms Pinsents and DLA Piper have both withheld profit distributions in recent months. Pinsents has withheld its last two quarterly profit distributions, with the firm attributing the "profits distribution holiday" to a series of management responses to the recession. It is due to make its next quarterly payment as planned in December.

China’s stimulus-induced lending binge probably propelled growth in the third quarter to its fastest pace in a year. Now, policy makers have to figure out how to wean the economy off state support, Bloomberg reported. The country’s rebound has been powered by 4 trillion yuan ($586 billion) of spending on railways, roads, power plants and public housing. The program ends next year, forcing Premier Wen Jiabao to find new ways to sustain the expansion with increased consumer spending and the financing of small businesses.

How much debt can an industrialized country carry before the nation’s economy and its currency bow, then break? In Japan, years of stimulus spending on expensive dams and roads have inflated the country’s gross public debt to twice the size of its $5 trillion economy — by far the highest debt-to-G.D.P. ratio in recent memory, The New York Times reported. Just paying the interest on its debt consumed a fifth of Japan’s budget for 2008, compared with debt payments that compose about a tenth of the United States budget.