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. Last Updated: 07/27/2016

'Russia Crisis' Lawsuit Hits U.K. Court

LONDON -- Lehman Brothers "sidelined and marginalized" a former top banker, who is suing the bank for $16.5 million, in the wake of the Russian financial crisis of 1998, his former secretary alleged in court on Monday.

Teresa Davidson, who worked at Lehman Brothers in London from January 1996 to March 2000, was giving evidence in Kerim Derhalli's lawsuit against Lehman Brothers, in which he is suing the U.S. investment bank for constructive dismissal and breach of contract in one of the biggest claims of its kind ever heard in the British High Court.

He claims the bank owes him the money in unpaid bonuses related to his work for them following the ruble crisis.

Davidson, who flew over from Sydney, Australia to give evidence, said Derhalli was increasingly sidelined after Lehman Brothers restructured its European Emerging Markets' business following the Russian crisis, even though this business had come the period in profit.

She said Derhalli was made head of East European sales, trading and research in the restructuring and remained in charge of European emerging markets. But Davidson said as the new structure was implemented, it became obvious to her that he did not have overall responsibility. "He was constantly sidelined and marginalized," she said in her evidence.

Lehman Brothers asserts that Derhalli was well paid for his work, earning some $6 million over 3 1/2 years.