Client Money Update - Supreme Court Order re: Permission to Appeal - 21/12/2010

This update concerns the application filed by the Joint Administrators on 1 May 2009 seeking directions from the Court concerning LBIE's obligations in relation to the handling of client money received prior to the time of administration (the "Client Money Application"). Further background to the Client Money Application can be found in earlier updates posted on the Client Money website.

The Court of Appeal's judgment on the directions sought by the Joint Administrators was handed down in August 2010. Further information in respect of that judgment and the permission to appeal from the Court of Appeal can be reviewed in the following Client Money updates  2 August 2010 and 12 August 2010.

In September 2010 the Joint Administrators, GLG Investments Plc Sub-Fund: European Equity Fund ("GLG") and Lehman Brothers Inc. ("LBI") sought permission to appeal directly from the Supreme Court.  Further information on the application filed to Supreme Court for permission to appeal can be found here:  27 September 2010 update.

The applications for permission to appeal have now been considered by the Supreme Court and an order has been made by the Appeal Panel. Please click here to review the order.

The Appeal Panel has granted GLG permission to appeal but refused LBI's application because it does not raise an arguable point of law of general public importance. The Joint Administrators application has been held over.

The Appeal Panel has requested a directional hearing to be held in the New Year which will (amongst other things) determine the likely timetable and duration of the substantive hearing before the Supreme Court.

The Joint Administrators and the Client Money team continue to make progress in identifying client money in unsegregated bank and transaction accounts and in indentifying entitlements to client money based on LBIE's client contracts despite the challenges outlined in the 14 October 2010 Joint Administrators' fourth Progress Report.

Please continue to check this website for information on all matters relating to the administration of LBIE.

Should you have any questions regarding this update, please direct them to clientpositionresponses@lbia-eu.com.