Italian City Gets Rare Win in U.K. Court as Dexia Swaps Quashed

The city of Prato won a lawsuit against Dexia SA over an interest-rate swap, becoming the first Italian municipality to overturn a disputed hedging deal at a London court. Dexia should have notified Prato that it had a week-long cooling off period when it could cancel the six swap contracts, Judge Paul Walker said in a written decision Thursday. Public bodies across Europe bought derivatives from banks to keep their borrowing costs down in case of rising interest rates.