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Court battle for Deutsche in New York

City A.M. Reporter
DEUTSCHE Bank and a banking unit of Saudi Arabia&rsquo;s Algosaibi family battled in court yesterday over whether to throw out a $74.2m (&pound;45.3m) claim by the German bank, part of a flurry of lawsuits involving billions of dollars and allegations of fraud.<br /><br />New York State Supreme Court Justice Bernard Fried said he expects to rule by 9 December whether The International Banking Corp, a Bahrain bank whose controlling shareholder is the Ahmad Hamad Algosaibi and Brothers conglomerate, did sufficient business in New York to subject it to litigation in the state.<br /><br />Several large Middle Eastern companies are caught up in a variety of litigation amid a feud between Algosaibi and the billionaire Maan al-Sanea, who married into the family.<br /><br />Regulators and bankers are trying to address up to $22bn of debt restructurings at Algosaibi and al-Sanea&rsquo;s Saad Group. Last week, Kuwait&rsquo;s Al Ahli Bank of Kuwait KSC sued Saadand al-Sanea for $125m, alleging breach of contract and fraud. <br /><br />The issue at yesterday&rsquo;s hearing was whether Deutsche Bank can recover damages for TIBC&rsquo;s failure to make good on its portion of two foreign exchange transactions, under which the German bank agreed to swap $59.8m for &pound;40m.<br /><br />A ruling favouring TIBC would free up assets that Deutsch Bank attached after it sued in May, court papers show. H Barry Vasios, a partner at Holland &amp; Knight who represents TIBC, said his client had only &ldquo;incidental&rdquo; contact with New York, and that its correspondent banking activity in the state is not relevant to Deutsche Bank&rsquo;s argument.<br /><br />Urging Fried to look at the &ldquo;totality&rdquo; of circumstances, Vasios said, &ldquo;Our performance is entirely outside the US. The deal was negotiated there. The deal was completed there.&rdquo;