Lehman Brothers Special Financing Inc.’s pending appeal against the judgments of the UK High Court and the Court of Appeal in the so called “flip clause cases”, concerning the enforceability of flip clauses, is scheduled to be begin with Belmont Park Investments Pty Limited (Belmont Park Investments Pty Limited v BNY Corporate Trustee Services Limited and Lehman Brothers Special Financing Inc (UKSC 2009/0222)) on March 1, 2011. The case is being closely watched by market participants interested to know whether the UK Supreme Court will resolve or confirm the apparent disparity between English and U.S. law regarding the enforceability of such clauses.

Please refer to our article “Flip Flop on Flip Clauses Continues” in the February 28, 2011 edition of Total Securitization for a discussion of the practical effect of the cases and the options available to mitigate their effect. Contact Elana Hahn or Andrew Crotty if you would like to discuss this topic in greater detail.