NEW YORK, N.Y. – Finance company Sparta Commercial Services, Inc. has sued a German bank for $84 million in a dispute over a line of credit that Sparta claims the bank promised but couldn’t deliver.
The lawsuit against the New York branch of DZ Bank, one of the largest banks in Germany, was filed in the United States District Court for the Southern District of New York.
Sparta claims DZ Bank contracted to extend a $25 million revolving credit facility to support Sparta’s business of financing and leasing powersports vehicles, but failed to disclose internal problems that prevented it from delivering.
“DZ Bank contracted with Sparta for the exclusive rights to provide Sparta with a $25 million credit facility for which we paid DZ Bank substantial six-figure fees, ” said Sparta CEO Anthony Havens. “Trusting the truth of what DZ Bank told us, we incurred substantial costs and losses which we seek to recover in this lawsuit, having learned that DZ Bank had its own, undisclosed internal issues, and misled us as to its intentions with regard to the credit facility.”
Among other claims, Sparta seeks damages of $84 million on allegations of DZ Bank’s fraud and breach of its fiduciary duties.
Posted by Holly Wagner