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Bankruptcy Law

Deutsche Bank Unit Must Face SunEdison Lenders’ Fraud Suit

July 14, 2020, 9:39 PM

Deutsche Bank Securities Inc. must face a lawsuit accusing the investment bank of duping a group of lenders into providing $725 million of junior secured loans to SunEdison Inc. as the energy company sputtered towards bankruptcy.

SESL Recovery LLC, which represents the lenders, can continue pressing fraud claims against the Deutsche Bank AG unit in California state court, Judge Ethan P. Schulman said in an order filed Monday, overruling the bank’s motion to dismiss the allegations.

The lenders participated in a second lien loan facility in 2016, just three months before SunEdison filed for bankruptcy. The plaintiff sufficiently alleged fraud...

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