<SPENCER COS> SUES CHASE MANHATTAN <CMB>
Spencer Cos Inc said it sued two Chase
Manhattan Corp units for forcing Spencer and its subsidiaries
to seek protection from creditors under Chapter 11 of the U.S.
Bankruptcy Code.
    The lawsuit, filed in the U.S. District Court for the
District of Massachusetts, seeks 100 mln dlrs in actual
damages, 300 mln dlrs in additional damages and recovery of
attorney's fees. In the nine-count complaint, Spencer contends
that Chase Manhattan Bank, while purporting to negotiate
additional financing, inflated Spencer's accounts, dishonored
its checks and seized 600,000 dlrs from its accounts without
notification.
    The company said Chase then demanded immediate repayment of
its 3.2 mln dlrs unsecured loan.
    The suit also names Chase National Corporate Services Inc
as a defendant.
    The damages sought include a loss of about 40 mln dlrs on
the liquidation of Spencer's Happy Legs Inc subsidiary, the
footwear retailer said.
    Spencer said it has recovered more than 500,000 dlrs of the
funds seized by Chase and has obtained financing from a leading
Boston bank.
    Boston-based Spencer filed for Chapter 11 on Nov 19, 1986.
 Reuter
