UBS AG said its employees would have to violate Swiss criminal law to comply with the U.S. government's demand for the identities of 52,000 private account holders, in its first legal response to the demand in a massive U.S. tax-evasion inquiry.

The U.S. court filing Friday threatens to draw both the U.S. and Swiss governments deeper into the already acrimonious showdown between the U.S. and UBS over the bank's private-banking practices.