By John Revill
ZURICH-- Swatch Group AG has failed in its legal bid to recover
24.8 million Swiss francs ($24.5 million) in losses from UBS AG,
after investments made by Switzerland's biggest bank on its behalf
turned sour during the financial crisis.
The Federal Supreme Court in Lausanne, Switzerland's highest
court, said in a decision released Thursday that it backed an
earlier ruling by a Zurich commercial court, which said Swatch was
responsible for its choice of investment.
The Supreme Court's judgment was dated Dec. 18.
The decision brings to a close a financial-and-legal drama that
has run since the Biel-based watchmaker placed 46.9 million francs
in investments with UBS in 2007. Those investments went bad during
the financial crisis, prompting a legal battle between Swatch and
UBS.
The court said UBS would only be liable for its recommendation
if was "obviously unreasonable at the time of issuance." It also
said the UBS's explanation of the risks involved in the investment
were reasonable, given that Swatch was a professional investor.
The court also ordered Swatch to pay 65,000 Swiss francs in
costs and 150,000 Swiss francs in damages to UBS. In addition,
Swatch will have to pay costs of 272,000 Swiss francs and 284,000
Swiss francs in damages to UBS that had been ordered earlier by the
Zurich court.
Swatch said it regretted the decision of the court, calling it
"a pity."
A spokeswoman for Zurich-based UBS said the decision confirmed
the bank had acted correctly.
Access Investor Kit for The Swatch Group AG
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=CH0012255151
Access Investor Kit for The Swatch Group AG
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US8701231065
Subscribe to WSJ: http://online.wsj.com?mod=djnwires