Who's Suing Whom: NatWest `black hole' spins off a $5m lost bonus claim

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ONE OF the four executives suspended by NatWest Markets last year over the discovery of a pounds 90m "black hole" is now suing the investment bank for $5m in unpaid bonuses.

Christophe Lanson was Global Head of Rate Risk Management at NatWest's investment banking arm when a series of mispriced deals and concealed losses were discovered in the bank's interest-rate options business.

The bank then hired solicitors Linklaters & Paines and accountants Coopers & Lybrand to carry out an independent study of the deals, which resulted in NatWest reducing the book value of its derivatives book by pounds 90m.

Mr Lanson left last year. The bank stressed at the time that Mr Lanson was not responsible for the losses, and was guilty of no wrongdoing whatsoever.

The writedown of pounds 90m resulted in a net charge against NatWest's profits of pounds 77 m - after a provision of pounds 5m and the reversal of unpaid bonuses of pounds 8m.

It is these bonuses which form the nub of Mr Lanson's argument. In a highly technical writ issued in the High Court last week, Mr Lanson argues that NatWest was wrong in the way it recalculated its traders' bonuses after the black hole was discovered. Now NatWest claims that Mr Lanson actually owes it some money back.

Mr Lanson is demanding that NatWest should open its books and justify its figures. He is also claiming $5,114,000 plus interest, representing bonuses he is owed from his trading time at the bank in 1995 and 1996.

The discovery of the black hole eventually led to the departure of six people in all from NatWest, and the Securities and Futures Authority (SFA) is still studying the affair. Mr Lanson has never been approached to be interviewed by the SFA.

In the aftermath of the black hole NatWest changed its corporate strategy, which in turn prompted NatWest Markets' then chief executive, Martin Owen, to leave.

Mr Lanson initially joined County Natwest Securities Japan Ltd in 1992, and that is the name on the writ he has issued via his solicitors Paisner & Co. He currently lives in Paris.

NatWest said they would contest Mr Lanson's writ "vigorously".

AN AMERICAN producer of designer-label clothing, Guess? Inc, has joined the group of manufacturers challenging Tesco Stores to a High Court battle over whether British retailers can sell cut-price designer goods bought on the "grey market".

The supermarket group, which is already being sued by Levi's for selling jeans bought in America, is now being sued by Guess? over the latter's range of tee-shirts.

Guess? is asking for an injunction to stop Tesco "passing off" Guess tee-shirts that have not been bought directly from the manufacturer - in other words, below list price.

Tesco has argued that the "Silhouette" judgement made in the European Court of Justice in July means it is allowed to hunt on the international markets for genuine goods at low prices. Others argue that the ruling, relating to Silhouette sunglasses, forbids UK retailers from buying grey market goods anywhere outside Europe.

IN A completely separate case, the Secretary of State for Health is suing Tesco over a three-year-old deal to sell the site of the South London Hospital for Women to the supermarket group for redevelopment. The deal now appears to be stalled due to a row over planning permission.

On 15 December 1994 the Department of Health agreed to sell the site at Balham Hill on the south side of Clapham Common to Tesco in order to build a store on it, pending planning permission. The site has sat unused for 14 years.

On 26 September 1995 Tesco submitted a planning application for the development. On 29 April 1997 it was refused. Tesco appealed. A year later the appeal was turned down.

The problem was that Tesco's plan involved the demolition of the Cooper building, which the planning authorities decided made a "positive contribution to the Clapham Conservation Area".

Also, "the bulk, mass, scale, rhythm, access provision and design details of the proposed building would cause harm to the established character and appearance of the... Area," the planning inspector said.

The Secretary of State for Health now wants Tesco either to submit plans for a smaller building or to pay the Department damages.

A Tesco spokeswoman said: "Tesco are confident that all the issues which are the subject of the writ will be resolved amicably in the very near future."