IMF clear to fund Lehman legal action

IMF (Australia) will go ahead with funding an action against Lehman Brothers Australia after a decision by the Federal Court removed the last obstacle.

IMF says it will provide funds to hundreds of investors, including local councils and charities, to recover monies lost from the investment in collaterised debt obligations.

On Friday, the Federal Court found against the validity of a deed of company arrangement, which had prevented the investors from pursuing claims against various Lehman entities in Australia.

The DOCA also prevented the investors from seeking payment from various Lehman insurance policies.