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By Dave Graham, John Revill and Kirsti Knolle ZURICH (Reuters) -Swiss authorities' 2023 decision to write off 16.5 billion Swiss francs ($20.53 billion) in Credit Suisse bonds was unlawful, a court said on Tuesday, raising fresh questions about how the bank's rescue and subsequent takeover by UBS was handled. The March 2023 decision by market regulator FINMA to wipe out Credit Suisse's Additional Tier 1 (AT1) bonds during the state-engineered takeover by its old rival UBS triggered an investor backlash and legal challenges. UBS SHARES SLIDE AFTER RULING UBS's shares fell after news of the Federal Administrative Court's decision broke, slipping over 3.5% in afternoon trade. In a partial decision, the court said the 2023 AT1 bond write-off lacked a legal basis. "It considered that the bondholders' property rights were seriously interfered with, which would have required a clear and formal legal basis. But no such basis existed," the court said. The decision can be appealed at the country's top court. The Swiss finance ministry and FINMA both said they would analyse the court's decision. UBS declined to comment. "The decision is not completely unexpected, and I expect it to be appealed," said Hans Gersbach, a banking and economics professor at ETH University in Zurich. 2023 DECISION LEFT MARKETS STUNNED The 2023 write-off stunned markets by prioritizing shareholder compensation over bondholder claims, upending the normal capital structure hierarchy. When Credit Suisse was taken over, shareholders received UBS stock valued at around $3.25 billion. AT1 holders were left with nothing, prompting lawsuits in Switzerland, the U.S., and investor-state arbitration under bilateral treaties. Around 3,000 complainants lodged appeals with the court over FINMA's decree in about 360 cases, the court said. In essence, complainants requested that the decree be revoked, and that the write-off be reversed, it added. The court made a partial decision in one appeal case and revoked FINMA's decree. It has not yet decided on the reversal request. The other cases are now suspended until a decision regarding the revocation of the decree has become final. Law firm Quinn Emanuel, which represents many of the complainants, welcomed the court's decision. "The Quinn Emanuel team is carefully reviewing the ruling to fully assess its implications," said Thomas Werlen, Quinn Emanuel's Managing Partner for Switzerland. Investors are unlikely to recover the full 16.5 billion francs, analysts have previously said, as the bonds had lost considerable value by the time of Credit Suisse's rescue. BONDS WERE DESIGNED TO PREVENT TAXPAYER BAILOUT AT1 bonds, introduced after the 2008 financial crisis, are hybrid debt instruments issued by banks to bolster their capital buffers and absorb losses in times of stress. The bonds, which are designed to help banks avoid taxpayer funded bailouts, typically offer higher yields than senior bank debt. While terms for AT1 bonds allow for write-downs under certain conditions, investors argued that FINMA's action violated expectations and contractual norms. ($1 = 0.8038 Swiss francs) ($1 = 0.8030 Swiss francs) (Reporting by Kirsti Knolle, John Revill, Dave Graham and Louise Heavens)

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By Ateev Bhandari and Saeed Azhar (Reuters) -Goldman Sachs beat Wall Street expectations for third-quarter profit on Tuesday, as its investment bankers earned higher advisory fees and rallying markets boosted revenue from managing client assets. The bank's prediction for a banner year for dealmaking has materialized as corporations revive plans for mergers and listings.   Goldman's investment banking fees surged 42% to $2.66 billion in the quarter ended September 30 from a year ago. Analysts were expecting a 14.3% increase, according to the average estimate compiled by LSEG. A Goldman executive said the firm advised on $1 trillion in announced mergers and acquisitions year to date, $220 billion more than its next closest competitor. It advised Electronic Arts on its $55 billion sale to a consortium of private equity firms and Saudi Arabia's Public Investment Fund this year, and also advised Holcim on the spinoff of its North American business Amrize, now valued at $26 billion. Goldman also advised Fifth Third Bancorp, which this month agreed to buy regional lender Comerica in a $10.9 billion deal to create the ninth-largest U.S. bank. ADVISORY FEES JUMP The growth was fueled by a 60% surge in advisory fees, while debt and equity underwriting fees also increased. Rival JPMorgan Chase also reported robust investment banking numbers. Goldman shares fell 4.7% in early trading. The shares have surged 37% year-to-date as of Monday, reflecting the dealmaking rebound. "This quarter's results reflect the strength of our client franchise and focus on executing our strategic priorities in an improved market environment," CEO David Solomon said in a statement. "We know that conditions can change quickly and so we remain focused on strong risk management," he said, echoing cautious optimism from JPMorgan CEO Jamie Dimon.  Global M&A volumes for the first nine months of the year crossed $3.43 trillion, with nearly 48% of it in the U.S., according to data from Dealogic.  The period also saw the highest average M&A volume globally and in the U.S. since 2015, in line with Solomon's prediction at last year's Reuters NEXT conference.  Goldman was among the joint book-running managers on marquee initial public offerings in the quarter, including design software firm Figma, Swedish fintech Klarna, and space tech firm Firefly Aerospace.  Overall quarterly profit was $4.1 billion, or $12.25 per share, exceeding Wall Street expectations of $11 per share. "The capital markets machine has clearly shifted into a higher gear, with robust stock prices, a reduced regulatory burden, and the prospect of lower interest rates likely to keep the momentum going," said Stephen Biggar, a banking analyst at Argus Research. Goldman executives have been increasingly optimistic about dealmaking in recent months, with Solomon saying in September it had one of its busiest weeks for IPOs in more than four years.  ASSET AND WEALTH MANAGEMENT FOCUS Revenue from asset and wealth management rose 17% to $4.4 billion, marking the first quarterly jump this year for the segment. This reflected record-high management fees, as well as private banking and lending revenue.  The business is a key priority for Goldman as it seeks steadier revenue from fees, which offset the volatility in its advisory and trading businesses. Goldman said last month it would take a stake worth as much as $1 billion in T. Rowe Price, as part of a partnership to tap the asset manager's retirement money for alternative assets. Assets under supervision climbed to $3.45 trillion, boosting management fees by 12%. Goldman set aside $339 million as provisions for credit losses, compared with $397 million a year ago. The provisions were mainly related to its credit card portfolio. SUSTAINED TRADING RESILIENCE  Wall Street trading desks have reaped rewards from record volatility as clients rejig portfolios to keep pace with changes in President Donald Trump's trade, foreign, and fiscal policies.      The third quarter, however, remained one of Wall Street's calmest quarters in nearly six years as an interest-rate cut from the Federal Reserve and robust AI investment pushed major U.S. stock indexes to record highs. Still, Goldman's equities trading revenue rose 7% to $3.74 billion, fueled by higher revenue in financing, which offset lower revenue from cash equities. Fixed income, currency and commodities hauled in $3.47 billion, 17% higher than a year ago.    (Reporting by Ateev Bhandari in Bengaluru and Saeed Azhar in New York; Editing by Lananh Nguyen, Arun Koyyur, Rod Nickel)

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By Jan Wolfe WASHINGTON (Reuters) -The U.S. Supreme Court declined a chance to reassess the broad legal immunity tech companies have over content hosted on their platforms, turning away on Tuesday an appeal in a lawsuit against Grindr by a male plaintiff who was raped at age 15 by adult men matched to him via the gay dating app. The justices decided not to hear the plaintiff's appeal of a lower court's ruling to dismiss his lawsuit seeking monetary damages against Los Angeles-based Grindr because the company was protected from liability by a provision of federal law called Section 230 of the Communications Decency Act. Enacted in 1996, Section 230 allows online platforms, including social media sites and online forums, to host user-generated content without being held legally responsible as the "publisher or speaker" of that content. The provision has shielded online platforms such as TikTok and Meta Platforms from a wide range of litigation. The plaintiff in the Grindr case has remained anonymous, being referred to as "John Doe" in court filings. His lawyers argued in a court filing that Section 230 has been a "goldmine for amoral companies who need not invest in providing safe products." Lawyers for Doe said four adult men raped him on consecutive days in April 2019, when he was a high school student in a small town in the Canadian province of Nova Scotia after he signed up for Grindr and falsely represented he was at least 18 years old. Grindr requires users to be over 18, but does not verify the ages of users. Three of the men were prosecuted in Canada and received multi-year prison terms, while the fourth remains at large, according to court papers. The plaintiff filed his civil lawsuit in California state court in Los Angeles in 2023, accusing Grindr of negligence and unlawfully failing to warn users about the risks of child sexual abuse, among other claims, as well as defective app design for matching adults and children for illegal sexual activity. It sought an unspecified amount of compensatory damages for physical and emotional harm, plus punitive damages of at least $66 million. After the case was moved to federal court, the California-based 9th U.S. Circuit Court of Appeals ruled in February that Section 230 barred Doe's state law claims. His lawyers in asking the Supreme Court to hear the case called it an optimal vehicle for addressing whether Section 230 "immunizes apps for their own conduct in marketing and designing defective products." Proponents of Section 230 have argued that, without it, online services would face potentially crippling legal costs and would be incentivized to censor free expression on the web. Republican President Donald Trump has been a critic of Section 230 and sought unsuccessfully during his first term in office to end the protections. The Supreme Court last addressed Section 230 in a set of rulings from 2023. In those cases, the justices declined to chip away at Section 230's scope and rejected lawsuits that sought to hold tech giants including Alphabet Inc liable for terrorism-promoting content on their platforms. Online platforms have urged courts not to weaken Section 230's protections. (Reporting by Jan Wolfe; Editing by Will Dunham)

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