Attorney: Finra panel orders UBS to buy back $529,688 of Lehman notes

By Lisa Kerner

Charlotte, N.C., Nov. 15 - A Financial Industry Regulatory Authority (Finra) regulatory panel ordered UBS Financial Services to buy back $529,688 of Lehman Brothers Holdings Inc. principal protected notes sold to a New York couple, according to a news release issued on Monday by Page Perry, LLC.

UBS was also ordered to pay the full costs of the hearing, which lasted over 20 sessions, in the case Edelson v. UBS Financial Services, case number 08-04357, decided Oct. 27, 2010, according to Page Perry, an Atlanta law firm.

"We believe this award, like the others we have won, shows the arbitrators believe UBS misnamed, mismarketed and misrepresented these products," said attorney Seth E. Lipner of Deutsch & Lipner, who represented the claimants in the case.

"UBS knew that Lehman was in trouble as far back as October 2007, but they continued to sell Lehman structured products anyway, ignoring the ever-growing risk," Lipner said.

Three separate arbitration panels in three separate cases over the past 18 months have ordered UBS to buy back notes sold to investors at their original cost.

UBS reportedly sold $1 billion of Lehman structured products to U.S. investors and is facing many similar arbitration claims across the country, according to the release.

J. Boyd Page, senior partner at Page Perry, said his firm continues to receive inquiries from investors who acquired Lehman structured notes as a result of UBS' misrepresentation.

"The brokers who sold the Lehman principal protected notes are not targets of investor claims," Page said.

UBS responds

"UBS properly sold Lehman structured products to UBS clients, following all regulatory requirements, well-established sales practices and client disclosure guidelines. Any client losses were the direct result of the unexpected and unprecedented failure of Lehman Brothers, which affected all Lehman bondholders," UBS spokesperson Karina Byrne said.

New York-based Lehman Brothers Holdings was the fourth-largest investment bank in the United States. The company filed for bankruptcy with the U.S. Bankruptcy Court for the Southern District of New York on Sept. 15, 2008. Its Chapter 11 case number is 08-13555.

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