By Emily Chasan
NEW YORK, Dec 9 (Reuters) - Barclays Capital fought back on Wednesday against claims by Lehman Brothers Holdings Inc that it got too good a deal when it bought Lehman's core U.S. brokerage last year.
In court papers filed on Wednesday and earlier this week, Barclays said creditors had been made "fully aware" of how the deal was structured before it closed and that a gain Barclays recorded after the sale was not the result of "secret" negotiations to transfer undisclosed assets.
"There was nothing 'secret' about this contract or its terms," Barclays said in the court papers.
Given the speed with which the deal was done and volatility of the credit markets, it would have been hard to know the exact values of the assets sold, Barclays noted.
Barclays claims it never said the deal would be "flat" -- with assets perfectly equal to liabilities -- and Lehman's own lawyers had said there was no time to do physical inventories or appraisals, and markets were extremely volatile, lawyers for the British bank said in court papers.
Now that markets have stabilized, Lehman and its creditors are trying to "re-trade" the deal, Barclays attorneys, from the firm of Boies, Schiller & Flexner LLP, said in the papers.
Last month, lawyers for Lehman Brothers filed a lawsuit against Barclays in an attempt to claw back billions of dollars of excess profit from the purchase of Lehman's brokerage business in September 2008.
The lawsuit, which seeks the return of $5 billion, followed claims from Lehman lawyers that Barclays Capital, the investment bank arm of Barclays Plc, received a "windfall profit" from excess assets it took control of in the sale.
Lehman's bankruptcy on Sept. 15, 2008, was the largest in the United States. Its flagship brokerage business was sold less than a week later in a hurried deal as the bank's lawyers argued it was a "melting ice cube" that was losing value by the minute.
The case is In re: Lehman Brothers Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555. (Editing by Ian Geoghegan)