A lawsuit filed by New Orleans alleging that "mismanagement" and "greed" at Ambac Assurance Corp. cost the city millions of dollars is nothing more than "a lot of sound and fury," the insurer said in a motion seeking dismissal of the case earlier this week.

The city said Ambac's exposure to structured finance products weakened the insurer's status as a credit enhancer, leading to failed remarketings of $171 million of taxable pension revenue bonds. In the July complaint, the city said increased interest costs due to the remarketing failure have cost the city $400,000 extra per month and more than $2 million in total. New Orleans paid about $6.4 million for the policy in December 2000.

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