Reuters: Bankruptcy News: SemGroup trust sues Barclays over $143 mln fee

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SemGroup trust sues Barclays over $143 mln fee Jul 10th 2012, 16:26 By Caroline Humer NEW YORK, July 10 | Tue Jul 10, 2012 12:26pm EDT NEW YORK, July 10 (Reuters) - A trustee representing creditors of SemGroup LP sued Barclays Bank Plc , seeking to be repaid a $143 million fee the bank collected when it took over the energy company's commodities trading positions during its 2008 collapse. The lawsuit, filed on Monday in U.S. District Court in Manhattan, says Barclays knew the fee would force SemGroup to increase its debt to pay the bank at a time it had little liquidity. The liquidity crisis contributed to SemGroup's decision to file for bankruptcy in July 2008. A spokesman for Barclays declined to comment on the lawsuit. The case is unrelated to an interest rate-fixing scandal involving Barclays, but lawyers for the trustee cited a pattern of potentially improper behavior by the bank. "As demonstrated by the recent announcement that Barclays will pay a fine of $453 million to U.S. and British authorities to settle allegations that it manipulated key interest rates, Barclays and its traders are not strangers to the possibility of manipulating prices or markets for profit," the lawsuit said. The lawsuit contends that as pressure mounted ahead of its bankruptcy, SemGroup was looking to offload its trading book. According to the trustee, Barclays rejected a deal that would have paid back creditors and instead used leverage from the worsening financial environment to extract the fee from SemGroup, allowing the energy company to be removed from its trading contract obligations. The lawsuit was filed by a litigation trust for SemGroup, which is trying to gather funds to repay creditors. The trust is led by Bettina Whyte, managing director at restructuring firm Alvarez & Marsal. SemGroup filed for bankruptcy after oil and commodities trading losses of about $2.4 billion, mostly on NYMEX. The energy transport and storage company, based in Oklahoma, emerged from bankruptcy in 2009. The case is in Re: Bettina M. Whyte vs Barclays Bank PLC, U.S. District Court, Southern District of New York. case no. 12-5318. Link this Share this Digg this Email Reprints

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