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Factbox: Lawsuits lodged over state-backed Credit Suisse takeover

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Several lawsuits have been filed over the terms of last month’s emergency deal to save Swiss lender Credit Suisse (CSGN.S) by selling it to its bigger rival UBS (UBSG.S).

The 3 billion Swiss franc ($3.4 billion) rescue, hammered out over a weekend during a bout of turmoil in the global banking sector, upended a long-established practice of giving bondholders priority over shareholders in a debt recovery.

Around 16 billion Swiss francs of Additional Tier 1 (AT1) Credit Suisse debt was written down to zero, in a shock to markets.

Law firms such as Quinn Emanuel Urquhart & Sullivan, Pallas Partners and Korein Tillery, a boutique law firm specializing in complex litigation, are among those who have spoken to prospective bondholder clients about bringing claims.

Shareholders are also nursing losses.

Here is a snapshot of legal action, by jurisdiction.

SWITZERLAND

A group of investors representing more than 4.5 billion Swiss francs of AT1 bonds sued the Swiss regulator in one of the largest such bondholder disputes, their lawyers said on April 21. The case was filed in the Federal Administrative Court in St Gallen, north east Switzerland. The regulator, FINMA, declined to comment.
The Federal Administrative Court says it is continuing to receive complaints and has “many more than four”. But it has declined to name claimants or provide an ongoing tally of those lodged by bondholders or their lawyers.
UNITED STATES

One of the first proposed U.S. class actions against Credit Suisse over alleged false or misleading statements pre-dates the rescue. In a case led by shareholder Braden Turner, investors alleged on March 16 that the bank failed to disclose it was suffering “significant” customer outflows and had material weaknesses in internal controls over financial reporting. Credit Suisse declined to comment.
A string of similar proposed class actions have been filed.
SINGAPORE

Credit Suisse investors in Singapore are also in talks to sue the Swiss government over the AT1 bond writedown on grounds it violated a free trade agreement, the Financial Times reported. The bondholders argue that the move breached protections against unfair state actions under the Singapore-European Free Trade Association signed with Switzerland in 2003, the newspaper said.
($1 = 0.8937 Swiss francs)

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BUSINESS

Colors promoting UN goals or LGBTQ rights? Turkey’s Erdogan complains.

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Turkish President Tayyip Erdogan voiced his displeasure with the United Nations’ use of “LGBT colors” to promote this week’s Sustainable Development Goals.

On Thursday, Turkish media claimed that Erdogan wanted to discuss the issue with U.N. Secretary-General Antonio Guterres. Erdogan and the Islamist-rooted AK Party, which he leads, have tightened their stance on LGBTQ rights in Turkey.


Erdogan said, “One of the issues that bothers me the most… is that when entering the United Nations General Assembly, you see the LGBT colors on steps and other places,” by the Turkish broadcasting company Haberturk and others.

To what extent does the global LGBT community currently exist? Erdogan, who has repeatedly called members of the LGBTQ community “deviants” and particularly sharpened his rhetoric during this year’s election campaign, said that whoever is against the LGBT community has just as much right to be there.

Some U.N. diplomats, however, have suggested that Erdogan may have confused the 17 colors used to decorate the U.N. headquarters for a summit held earlier this week with the rainbow Pride colors associated with LGBTQ rights.

Guterres is an outspoken advocate for LGBTQ rights, yet the United Nations building does not include the rainbow Pride flag.

When asked for a reaction to Erdogan’s comments, a representative for Guterres did not provide any right away.

The 17 Sustainable Development Goals, with a 2030 deadline, are a global “to-do” list with goals like eradicating extreme poverty and hunger, addressing inequality and climate change, and advancing gender equality.

Although

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In Washington, Zelenskiy courts Congress, Biden on military aid

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Vice President Joe Biden informed Ukrainian President Volodymyr Zelenskiy that despite opposition from some Republican lawmakers to giving billions more in aid, the United States will continue its strong support for his struggle to repel Russian invaders.

The Ukrainian leader, Zelenskiy, met with Vice President Biden in the White House’s East Room for a war council as part of a flurry of public appearances he made to rally American support for a conflict that has been ongoing since February 2022.
Biden told Zelenskiy, “Mr. President, we’re with you, we’re staying with you,” before shaking his hand at the end of their two-hour meeting.

Zelenskiy thanked Biden for a new $325 million military aid package, stating, “it has exactly what our soldiers need now.”

He said he and Biden had settled on concrete measures to increase Ukrainian grain exports despite a Russian blockade and tensions with neighboring Poland. He was vague on how to proceed.

House Republican conservatives are blocking Vice President Biden’s request for an additional $24 million in Ukraine financing to pay for the country’s defense and humanitarian aid through the end of the year.

When asked how to win over skeptics, Vice President Biden stated that they must first win over the United States Congress.

I trust the Congress of the United States to make the right decision. There’s no way out,” he concluded.

The resistance was encapsulated by Senator Rand Paul of the Republican Party, a vocal opponent of foreign aid. When asked about the war’s prospects, he told Fox Business News that Ukraine’s “corrupt regime” makes peace unlikely.

Biden announced that the first American Abrams tanks would be sent to Ukraine the next week.

Besides backing changes that would combat corruption, the United States is “committed to helping Ukraine defend itself now,” as Vice President Joe Biden put it.

FLYING DEFENSE
Vice President Biden announced that the United States would ship another Hawk air defense battery to Ukraine, this one manufactured by Raytheon. According to a U.S. official, the equipment will arrive shortly in Ukraine.

Zelenskiy came to Washington on a blitz throughout the city after seeking international support at the United Nations on Wednesday. He spoke with military chiefs at the Pentagon, toured the U.S. Capitol, and gave a talk at the National Archives museum later that day.

During his meeting with Zelenskiy earlier in the day, Vice President Biden praised the bravery of the Ukrainian people and announced a fresh $325 million military aid package for Ukraine.

At the outset of their conversation, Biden remarked, “Together with our partners and allies, the American people are determined to see to it to that (we) do all that we can to ensure that the world stands with you.”

Ukrainian Foreign Minister Pavlo Zelenskiy thanked the United States for helping “to combat Russian terror” and promised to talk to Vice President Joe Biden about the country’s defense needs, emphasizing air defense.

“Today I’m in Washington to strengthen our ability to defend Ukrainian children, our families, our homes, freedom, and democracy around the world,” he added.

Although Vice President Biden and most congressional leaders still support aid to Ukraine and Biden’s Democratic Party controls the Senate, Zelenskiy encountered a rougher crowd than on his previous visit nine months ago.

Senator Chris Murphy wrote on platform X that Zelenskiy, dressed in military green to signify his rank as a combat leader, informed the entire U.S. Senate in the historic Old Senate Chamber and received many standing ovations.

Senators were briefed behind closed doors by Zelenskiy, who reportedly informed them that military aid was critical to Ukraine’s war effort. Majority Leader Chuck Schumer said this in the Senate chamber after the session.

If we don’t get the aid, we’ll lose the fight, Zelenskiy was reported as saying by Schumer.

After the fact, Zelenskiy said that his interactions with parliamentarians were open and fruitful.

Zelenskiy spoke with U.S. Defense Secretary Lloyd Austin and other high-ranking officials at the Pentagon. He and his wife left bouquets at the Pentagon’s memorial for the victims of the September 11, 2001 attacks.

Washington plans to enhance Ukraine’s long-term defense capabilities by hosting a meeting for the U.S. defense industry, Ukrainian business executives, and government officials to explore collaborative ventures and co-production this fall.

According to the White House, Zelenskiy discussed his plans to combat corruption with Vice President Biden during their discussion. Biden stressed the need for robust anti-corruption institutions in Ukraine.

In front of a case containing the United States Constitution, Zelenskiy delivered his address of gratitude to the American people, declaring, “there is not a soul in Ukraine that does not feel gratitude to you, America.”

Doctors who cared for Ukrainian soldiers and civilians received prizes, and Zelenskiy and his wife recognized those who helped raise money for ambulances and other medical supplies.

An increasing number of Republicans have questioned the billions of dollars Washington has supplied Kyiv for military, economic, and humanitarian needs as Ukraine’s counteroffensive goes on and Congress prepares a fierce battle over spending ahead of a possible government shutdown.

Since Russia’s invasion in February 2022, the United States has provided about $113 billion in security and humanitarian aid to support Zelenskiy’s government.

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Biden raised the issue of the Canadian Sikh’s murder with Modi at the G20.

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According to a story in the Financial Times on Thursday, U.S. Vice President Joe Biden and other world leaders voiced their worry to Indian Prime Minister Narendra Modi during this month’s G20 conference about allegations that New Delhi was complicit in the assassination of a Sikh separatist leader in Canada.

The newspaper reported, citing three people with knowledge of the summit, that several members of the Five Eyes—the United States, the United Kingdom, Canada, Australia, and New Zealand—brought up the June killing in British Columbia of Hardeep Singh Nijjar, a Sikh separatist leader, with Modi.

A call for comment from the White House on the FT article initially went unanswered.

The event occurred in India several days before Canadian Prime Minister Justin Trudeau made his accusations public earlier this week in a speech to parliament.

Canada reportedly persuaded its allies to bring up the issue with Modi during the G20 summit, and the leaders intervened.

U.S. national security adviser Jake Sullivan said on Thursday that Washington is not granting India a “special exemption” in the case despite Ottawa’s accusations about the murder of the Sikh separatist leader in Canada and that the U.S. is in contact with Indians at high levels.

India has deemed Canada’s accusations to be “absurd” and has rejected them. The current crisis has further strained relations between Canada and India. On Thursday, India ordered Canada to downsize its diplomatic presence and halted issuing new visas to Canadian citizens.

As a longtime partner and ally, Canada has put several Western countries in an awkward position as they strive to strengthen ties with New Delhi to offset China’s dominance in the Asia Pacific area.

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