Today's deadline for Deutsche Bank to appeal last month's decision in favor of monoline Ambac has been reached without any indication of the bank's intentions. Chip Goodrich, Deutsche Bank's in-house counsel, Ted Aden, its outside counsel at Epstein Becker & Green, and Michele Allison, Deutsche Bank spokeswoman, did not return phone calls for comment on the appeal, and market participants are unsure what is going on. "It's been complete radio silence since the decision," said one derivatives lawyer.
If Deutsche Bank does not appeal, the decision in favor of Ambac for not paying credit protection on defaulted bonds Deutsche Bank delivered after the delivery deadline (DW, 7/6) will set a precedent. Derivatives lawyers said hedge funds, monolines and other protection sellers have been emboldened by the decision and are more likely to fight back against dealers going forward. In the past, lawyers said protection sellers tended to settled out of court rather than incurring the cost of fighting late delivering protection buyers.
