Defense counsel for a major bank retained Cornerstone Research in a case arising from a synthetic collateralized loan obligation (CLO) transaction. Defense counsel for a major bank retained Cornerstone Research and Steven Grenadier of Stanford University in a case arising from a synthetic collateralized loan obligation (CLO) transaction between the bank and the plaintiff, a hedge fund. Under the contract, the bank agreed to pay insurance premiums to the hedge fund, while the hedge fund agreed to compensate the bank for credit losses, if corporate borrowers defaulted on their senior secured obligations referenced in the CLO. After a corporate borrower undertook a leveraged buyout (LBO), one of the reference obligations was no longer outstanding and had to be replaced. The bank substituted t

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