Merrill wins court ruling in debt case

LOS ANGELES, June 10 - A US District Court judge ruled on Tuesday that Security Capital Assurance Ltd’s XL Capital Assurance unit will have to stand by $3.1bn of guarantees on collateralized debt obligations, in dispute with Merrill Lynch.

Judge Jed Rakoff in a summary judgment ruled that Merrill Lynch International had not repudiated its obligations under seven credit default swaps it entered with XCLA, and that XLCA’s attempt to terminate those swaps was invalid.