- U.S. District Judge Kevin Castel has rebuffed Citigroup (C) and ruled that arbitrators and not federal judges can decide whether the Abu Dhabi Investment Authority (ADIA) can seek a second arbitration in a dispute over the sovereign wealth fund's $7.5B investment in the bank in late 2007.
- ADIA is seeking $2B in damages or to rescind the investment, for which it received a 4.9% stake in Citibank, which needed the cash six years ago to help shore up its finances following writedowns for sub-prime mortgages.
- ADIA is claiming breach of contract, and breach of an implied covenant of good faith and fair dealing. Citibank issued preferred shares to other investors that diluted ADIA's stake.
- ADIA lost the first arbitration decision two years ago.
Citigroup dealt blow in $2B Abu Dhabi suit
Nov 26 2013, 04:38 ET