Business Litigation – Credit Default Swap Agreement Involving Morgan Stanley

Recently in a Manhattan federal court, Citigroup has pressed charges against Morgan Stanley due to their involvement of a credit default swap. Citigroup claims that Morgan Stanley renounced their $245 million mutual contract to pay them if in the occurrence that an issuer of collateralized debt obligations refused to pay required payments on the credit line set forth in the agreement by Citigroup. Although, the complaint stated that the contract to liquidate the collateralized debt obligations did not equal to the amount that Morgan Stanley owes Citigroup therefore, Morgan Stanley refused to pay their debt, ending in the effect of a $245 million dollar lawsuit.

– Source: Reuters

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