Citigroup Can’t Block Abu Dhabi Arbitration

Citigroup is the third largest bank in the United States, even after they paid off three separate bail-outs. Abu Dhabi invested a $7.5 billion into the company for a 4.9 percent share of the bank. This put Abu Dhabi at the top of the list in terms of individual shareholders. Now, Abu Dhabi is claiming that Citigroup has fraudulently made the deal look better than it really was, by giving better shares to other investors and diluting their own shares. They claim it broke their contract, as well as was a form of unfair dealing. Citigroup is trying to block the arbitration of this matter, but they are not going to be able to. The value of the first judgement was indeed supposed to be ruled by arbitrators, not judges, according to a district judge from Manhattan. This case is a hard hit after the shares of Citigroup are already not faring too well. Judge Castel said that the first arbitration was not in error, and any claims that it would prevent judges from making rulings on further related cases were not valid because it wasn’t a matter of the court to decide. The legal turmoil that Citigroup is experiencing isn’t likely to benefit the share value at all.

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