A US federal judge suspended the fraud case into DaimlerChrysler's merger indefinitely after fresh evidence came to light on Tuesday, the BBC reported on its website.

Judge Joseph Farnan appointed a Special Master, who is also a judge, to examine the documents, the report said.

Lawyers for investor Kirk Kerkorian, who is suing the car maker, alleged the papers had been improperly withheld, the BBC said.

The report noted that DaimlerChrysler denies falsely describing a takeover as a merger to save on payouts to shareholders and that Kerkorian, whose investment group Tracinda was Chrysler's largest shareholder at the time of the merger, is seeking up to $US2 billion (£1.15 billion) in compensation.

According to the BBC, the surprise twist to the two-week old hearing came after DaimlerChrysler's lawyers handed Kerkorian's legal team a packet of documents on Monday night which contained 61 pages of material relating to the tie-up between the two car firms. Judge Farnan reportedly described the papers as containing "in some instances very substantial testimony".

The BBC said that Kerkorian's lawyer, Terry Christensen, said he was "shocked" by the papers and demanded a judgement in favour of his client.

"These defendants have defaulted on their responsibility to the court," he reportedly said, adding that DaimlerChrysler's law firm did not appear to have behaved in an "untoward" way.

The BBC said the documents were handed over ahead of testimony from Gary Valade, who was Chrysler's chief financial officer at the time of the tie-up negotiations - most of the notes are believed to come from Valade's files.

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