A bankruptcy judge has denied an attempt by Lehman Brothers to recover from Barclays $500 million it alleges was supposed to go toward employee bonuses.

In a ruling lodged yesterday in a bankruptcy court in Manhattan, on the third anniversary of Lehman’s filing for bankruptcy, Judge James Peck denied Lehman’s bid for a judgment forcing Barclays to pay it back $500 million in bonuses for Lehman employees it inherited when it bought Lehman’s North American brokerage in 2008.

Lehman’s said Barclays never gave the money to the employees and should send it back for the benefit of Lehman creditors.

The sale of Lehman’s North American business to Barclays, completed quickly following the bankruptcy, has been the subject of long- lasting litigation. Lehman earlier tried to invalidate the sale, saying Barclays secured an $11 billion windfall by withholding information from the court. Judge Peck upheld the sale in February. – (Reuters)