HFW to initiate $5 billion class action

Global law firm HFW is set to launch a significant class action against Switzerland, seeking US$5 billion following the collapse of Credit Suisse and the subsequent write down of CS AT1 bonds. This legal move has been instigated by a considerable group of bondholders from Credit Suisse AT1, who have instructed the firm to commence an investor state treaty arbitration. The claims will be presented at the International Centre for Settlement of Investment Disputes, located in Washington D.C., focusing on alleged breaches of Switzerland's obligations under international law and specific treaties related to investment.

The decision to write down the AT1 bonds has drawn sharp criticism from worldwide financial regulators and central banks, with many denouncing it as inconsistent with the standard loss absorption hierarchy. Evidence from the banking sector, along with expert opinions, reinforces the argument that the thresholds necessary to trigger the write down provisions were not met. An important report released by Switzerland towards the end of 2024 contains critical admissions that bondholders intend to leverage during the arbitration process.

Shaun Leong, a partner at HFW, is spearheading this initiative, enlisting the support of partners throughout the firm’s international network. Notable contributors include Paul Buitendag from Melbourne, who has extensive experience in class actions, as well as international arbitration specialists Nick Longley, Julien Fouret, and Damian Honey located in Melbourne, Paris, and London respectively.

In highlighting the sizable financial implications of this case, Shaun Leong remarked, "We have already gathered a substantial group of some of the largest Credit Suisse AT1 bondholders in Singapore, with an approximate aggregate claim sum accounting for interest and coupon rates at over US$80 million. Bondholders from China, Hong Kong, The United Arab Emirates, Japan, Republic of Korea, Kuwait, Oman, The Philippines, Qatar, and Saudi Arabia are welcome to join and should act quickly if they wish to get involved. The estimated aggregate bondholder exposure quantum would be in excess of US$5 billion."

Leong anticipates Switzerland will assert a three-year time bar concerning claims, given that the write down occurred in April 2023. He noted, "As we are a few months away from April 2026… any claims that are not formally launched would have expired by then, even though we would argue that is inapplicable under international law." HFW is prepared to assist Credit Suisse AT1 bondholders in ensuring their claims are submitted promptly before the time bar comes into effect.

For those interested in participating in the AT1 bond group action or seeking further information, bondholders are encouraged to visit HFW's website and register. The registration process is complimentary and does not compel bondholders into a formal engagement, allowing them to stay updated on the case’s progress.

HFW is renowned for its robust international arbitration practice, recognised by Global Arbitration Review and other notable directories for its expertise and expansive reach. The firm provides counsel to clients on complex, high-value disputes across a variety of sectors, which includes aerospace, energy, construction, shipping, commodities, and insurance. With specialists situated in key global hubs such as London, Paris, Geneva, Dubai, Singapore, Hong Kong, Perth, Melbourne, and Sydney, HFW handles proceedings under all major institutional rules, solidifying its reputation for delivering strategic and commercially oriented advice on a worldwide scale.