United States

The US Justice Department sued German giant Deutsche Bank Tuesday for more than $1 billion for mortgage fraud, saying the bank illegally obtained government insurance for substandard mortgages during the US housing boom, Agence France-Presse reported. Deutsche Bank and its subsidiary MortgageIT "repeatedly lied to be included in a government program to select mortgages for insurance by the government," the Justice Department complaint said.

Nortel Networks Corp. said Monday it has received court approval for a $900-million "stalking horse" bid by Google for the company's remaining patents and patent applications, the Winnipeg Free Press reported on a Canadian Press story. Qualified bidders hoping to top the Google offer will be required to submit offers by June 13, while the auction is set for June 20. The winning bid will require approval by the U.S. and Canadian courts overseeing the sale process.

A fund controlled by billionaire investor Len Blavatnik has been asked to return EUR100 million ($145.8 million) to the bankruptcy estate of chemical giant LyondellBasell Industries, which emerged from Chapter 11 protection last year but left a trustee to file lawsuits to recover funds for the company's unsecured creditors, Dow Jones Daily Bankruptcy Review reported. In a lawsuit filed Friday with the U.S.

Quebec-based forestry company Tembec Inc. is liquidating its U.S. subsidiary, nearly four years after shuttering its Louisiana coated paper mill, The Canadian Press reported. Tembec USA, a division of the company that no longer has any operating assets, has applied to a U.S. bankruptcy court for Chapter 7 protection, Tembec announced Monday. Unlike Chapter 11, this section is designed for companies seeking liquidation rather than restructuring. Tembec said its U.S. division has US$81 million in debt and assets worth $1 million.

Google Inc. has been selected as the stalking-horse bidder for the entire patent portfolio of former telecommunications giant Nortel Networks Corp., administrators for the insolvent Canadian company said Monday, the Financial Post reported. Mountain View, California-based Google has entered a bid of US$900-million for a portfolio of more than 6,000 patents that cover device and network technologies. Google’s stalking-horse offer is designed to attract higher bids from other interested groups, which could include BlackBerry maker Research In Motion Ltd. An auction is slated for June.

A new group of noteholders has signed on to support a prepackaged bankruptcy plan for Mexican satellite company Satelites Mexicanos S.A. de C.V., which emerged from an earlier Chapter 11 restructuring in 2006, Dow Jones Daily Bankruptcy Review reported. The company, known as Satmex, said more than 66% of the holders of its first priority senior secured notes due 2011 executed a restructuring support agreement with the company, under which they agree to back the company's prepackaged Chapter 11 plan.

Canadian drug maker Angiotech Pharmaceuticals Inc. says a "large consortium" of its creditors is backing the reorganization strategy it proposed in its home country, and it's asking a U.S. bankruptcy judge to sign off on the restructuring plan that it will put before a Canadian court on April 6, Dow Jones Daily Bankruptcy Review reported. In papers filed Friday with the U.S.

The world’s most powerful central banks joined forces to sell billions of dollars worth of yen, battling speculators – described as “sneaky thieves” by one Japanese official – who have driven the currency to record highs, the Irish Times reported. The intervention by banks including the Federal Reserve, European Central Bank, Bank of Japan and Bank of England began early yesterday, after ministers from the Group of Seven most industrialised nations approved the first such co-ordinated action in more than a decade.

U.S. private-equity fund TPG Capital and Japanese consumer lender J-Trust are the likely contenders to take over failed consumer lender Takefuji, in a decision to be announced as early as the end of this month, according to sources familiar with the situation, The Wall Street Journal reported. TPG Capital, Cerberus Capital Management, J Trust, Tokyo Star Bank and Korea's A&P Financial are the five finalists for the final round of bidding, the people said.

Pacific Investment Management Co. sees the potential for better returns from selling insurance against sovereign defaults than owning government bonds, according to London-based managing director Andrew Balls, Bloomberg reported. “Rather than taking exposure to interest-rate risk, it may be attractive to sell protection against the default of a country,” Balls told reporters at a media briefing in London today. “I would see the probability of default from the U.S. or U.K.