On October 21, 2025, the Texas Court of Appeals reversed a trial court’s award of nearly $27 million in prejudgment interest entered against Credit Suisse on remand after previously holding that settlement credits reduced a $40 million verdict to zero. The litigation stems from a 2007 refinancing in which Credit Suisse allegedly induced the assignor of plaintiff Claymore Holdings to invest $250 million in a Lake Las Vegas golf course development based on an appraisal that Credit Suisse purportedly knew was inflated and unreasonable. Plummeting property values caused the borrower to default on the refinancing and the assignor to incur substantial losses.
After the Texas Supreme Court reversed and remanded the original underlying judgment, the trial court on remand awarded $40 million in fraudulent inducement damages determined by the jury, plus over $20 million in additional damages for secondary market purchases. In February 2023, the Texas Court of Appeals reversed the latter award, reduced the $40 million verdict to zero after giving Credit Suisse credit for various settlements Claymore had reached with other parties, and remanded to the trial court again to consider only prejudgment interest under that damages award calculation. On remand, the trial court awarded nearly $27 million in prejudgment interest in a final judgment in September 2024.
Considering the case for the third time, the Texas Court of Appeals rejected Claymore’s request to revisit its prior holding and ruled that the trial court erred in its award of prejudgment interest. First, the court emphasized the familiar rule that horizontal stare decisis precluded review of the decision of an earlier panel of the same court absent a contrary ruling from a higher authority. Overruling the prior panel, the court said, would invite “chaos and unpredictability.” Second, the Appeals Court held that the trial court erred by awarding prejudgment interest. Because Claymore’s prior damages award was reduced to zero, and “any amount of interest applied to a zero-dollar judgment is inescapably zero,” Claymore was entitled to zero dollars in prejudgment interest, the court held.
The case is Credit Suisse AG v. Claymore Holdings, LLC, No. 05-24-01124-CV (Tex. App. Oct. 21, 2025). Claymore is represented by Reid Collins & Tsai LLP. Credit Suisse is represented by Baker Botts LLP and Tillotson Johnson & Patton. The opinion is available here.
