The regulator in charge of failed banks is deploying a new legal argument in hopes of recouping funds lost in a costly 2015 closure.

The Federal Deposit Insurance Corp. has filed a lawsuit arguing that manipulation of the London Interbank Offered Rate led to losses at San Juan, Puerto Rico-based Doral Bank, which failed in 2015 and cost the regulator's deposit insurance fund $748.9 million. As the bank's receiver, the FDIC is suing 16 large international banks for their role in the rigging, alleging that the colluded rate negatively impacted Doral's loan portfolio and derivative holdings.

The argument is a novel one for the FDIC, said an attorney familiar with bank receivership lawsuits, but it is similar to claims made in the past — such as accusations that misrepresented mortgage-backed securities sold by large banks led to failed banks' financial troubles. As the receiver, the FDIC is trying to identify parties that may have contributed to a bank's financial deterioration or failure, and if those parties have financial resources that help replenish the insurance fund. These receivership lawsuits more commonly target directors and officers and sometimes include attorneys and law firms for malpractice.

The FDIC's claim follows settlements and fines from numerous regulators that the banks involved with setting LIBOR colluded to raise it artificially. LIBOR was used as a benchmark interest rate in a number of products, including floating-rate loans and derivatives that would reduce interest-rate risk. Banks involved in the allegations collectively paid billions in fines and settlements. In its lawsuit, the FDIC argued that banks like Doral "reasonably" relied on representations that LIBOR was calculated "honestly and reliably."

The defendants in the case are Bank of America NA, JPMorgan Chase Bank NA, Citibank NA, Royal Bank of Canada, the U.K.'s British Bankers' Association, BBA Enterprises, BBA Trent Ltd., Barclays Bank Plc, HSBC Bank Plc, Lloyds Banking Group Plc, Lloyds Bank Plc and Bank of Scotland Plc, Deutsche Bank AG and Portigon AG, Société Générale SA, UBS Group AG, Credit Suisse Group AG and Credit Suisse International, Rabobank, Norinchukin Bank and Bank of Tokyo-Mitsubishi UFJ Ltd.

But the claim could be complicated by facts surrounding Doral's failure, the catalyst of which seemed to be the disavowal of a large tax asset from the bank's capital levels in May 2014. The bank was unsuccessful at suing the Puerto Rico government for the tax asset, and it received a prompt corrective action directive in January 2015, the same month that regulators rejected its recapitalization plan. Doral participated in a number of asset sales to shrink itself, but it was closed by regulators in February 2015.

The attorney said the argument that LIBOR-linked products caused financial deterioration could potentially apply to other banks that closed around the same time, although smaller failed banks may not have significant-enough exposure to LIBOR. The FDIC conducts analysis ahead of filing receivership lawsuits and maps out what a trial could look like and cost. It also considers how the defendant could respond and if a settlement is likely.

The FDIC's lawsuit is not the only suit alleging harm from LIBOR manipulation. In September 2013, the National Credit Union Administration filed a lawsuit accusing 13 international banks of manipulating LIBOR and contributing to losses incurred through the failure of five corporate credit unions. At least two small banks have also filed LIBOR lawsuits.