Citigroup Inc. (C) won a bid to block a $383 million arbitration case brought by Saudi businessman Ghazi Abbar.
U.S. District Judge Louis Stanton yesterday granted an injunction, at the end of a nine-day trial in Manhattan, blocking Abbar from arbitrating the case before the Financial Industry Regulatory Authority. Abbar claimed New York-based Citigroup Global Markets Inc. mishandled his family’s investments and claimed a right to arbitrate the claim before Finra.
Citigroup claimed Abbar was a client of Citigroup Global Markets Ltd., based in London, and therefore can’t force a Finra arbitration. Stanton, who said Abbar interacted with Citigroup divisions and offices in New York, London and Geneva in connection with his family’s investments, ruled that his account was with the London-based unit, not the New York unit.
“The entity in which the investor has his account, and from whom the investor purchases his desired product, defines the legal and business locus of his status as a customer, and is the core of the relationship as a customer,” Stanton said in his decision made public today.
“We are pleased with the decision,” Natalie Marin, a Citigroup spokeswoman, said today in an e-mail.
The case is Citigroup Global Markets Inc. v. Abbar, 11- cv-06993, U.S. District Court, Southern District of New York (Manhattan).
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