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Failed bank sues for 2.5bn dollars

Lehman Brothers Holdings is suing several units of Citigroup to recover 2.5 billion US dollars it transferred to a back-up account at Citi months before seeking bankruptcy court protection.

The failed investment bank filed the lawsuit on Wednesday with the US Bankruptcy Court for the Southern District of New York.

Among other claims, Lehman says Citibank is wrongfully withholding the money as a potential source of funds in a dispute over derivative contracts.

In a statement, Citigroup called the lawsuit unjustified and accused Lehman of trying to renege on its obligations and claw back assets to which it has no right.

Lehman's bankruptcy filing in September 2008 was the biggest in US history.

Lehman Brothers Holdings is the company that controls what is left of the investment bank's assets.

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