By Dario Item

Core Capital Partners Ltd, a Nassau, Bahamas-based asset management firm, filed a class action lawsuit on Oct. 20 against Credit Suisse, its former officers Axel P. Lehmann and Sir Antonio Horta-Osorio (former chairmen of the board of directors), Ulrich Körner and Thomas Gottstein (former CEOs), Dixit Joshi and David R. Mathers (former CFOs) and PricewaterhouseCoopers AG (as auditing firm) before the U.S. District Court for the Southern District of New York (case number 1:23-cv-09287).

Plaintiff Core Capital Partners Ltd’s action is based on theory fraud-on-the-market. According to this theory, the prices of financial securities are a function of all material information about the company and its business. Core Capital Partners Ltd alleges that the defendants violated Rule 10b-5 of the U.S. Securities and Exchange Commission (which is one of the SEC’s key securities fraud laws) by disseminating materially false and misleading statements about corporate, operational and compliance policies. CSG and PWC’s violations allegedly allowed AT1s to reach artificially overvalued prices causing major losses to investors even before FINMA’s March 19 decision to write them down.

From the class action lawsuit (see the document below), Core Capital’s clients allegedly lost more than $1.2 billion in the period between Feb. 18, 2021, and March 19, 2023, when FINMA ordered the AT1s to be wiped out.

Core Capital Partners Ltd is represented by Jeremy A. Lieberman, J. Alexander Hood II, Thomas H. Przybylowski and James M. LoPiano of Pomerantz LLP and Peretz Bronstein of Bronstein Gewirtz & Grossman LLC.

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