Barclays American depositary receipts dropped 54 cents, or 2.9 percent, to $17.88 yesterday in New York Stock Exchange composite trading. They fell as much as 3.6 percent during the session. Each ADR represents four ordinary shares.

Peck may require Barclays to return to Lehman any assets that were included in the deal as part of the clarification letter because the letter wasn't approved by the court, said Chip Bowles, a bankruptcy lawyer at Greenebaum Doll & McDonald PLLC in Louisville, Kentucky. Barclays also may lose its bid to get additional assets, he said.

Not Final

"Judge Peck has made it clear that the clarification order was never approved by the court and in fact never was heard by the court and that means it probably does not have any of the protection the rest of the sale order would have," Bowles said.

Peck could rule "the clarification has no effect whatsoever," Bowles said. "That what's he signaling -- that this is not sacrosanct, this is not a final order of the court."

Peck may make a final ruling in January or February, lawyers in the case have said.

The battle pits bankrupt Lehman, which examiner Anton Valukas said hid billions of dollars in risks before it failed, against Barclays, the sole bidder for the brokerage.

Earlier, Robert Gaffey of Jones Day, Lehman's litigator, said the law is on Lehman's side. Grounds for Peck to revise his own sale order include mistakes or misrepresentation that may be innocent, he told the judge.

Three Lawsuits

Peck is presiding over three lawsuits against Barclays, including one by the Lehman brokerage's trustee, James Giddens, and one by creditors.

Any money Peck awards Lehman would help its creditors, who stand to get 15.8 cents on the dollar on average, and hurt shareholders of Barclays, which reported net income of 2.4 billion pounds ($3.8 billion) in the first half.