A lawyer for Terra Firma Capital Partners Ltd. and its Chairman Guy Hands asked an appeals court today for a new trial on their $8.3 billion claim against Citigroup Inc. over the 2007 sale of EMI Group Ltd.
Citigroup won a verdict in Manhattan federal court in 2010, successfully defending against Hands’s claim that the bank tricked him into overpaying for EMI, the London-based music company.
Hands claimed that a Citigroup banker, David Wormsley, lied to him in phone calls made the weekend before the EMI auction on May 21, 2007, a Monday, leading the private-equity firm to overbid in a deal that lost money for all involved.
Hands claimed Wormsley told him that Cerberus Capital Management LP planned to submit a bid. Cerberus had in fact decided to withdraw from the auction, leaving Terra Firma without competition.
Much of the parties’ oral arguments today centered on Terra Firma’s claim that U.S. District Judge Jed S. Rakoff, who presided over the trial, failed to instruct jurors properly that Terra Firma was entitled to a presumption that it relied on Citigroup misrepresentations.
Hands, who attended today’s court proceeding, declined to comment on the case afterward.
The case is Terra Firma Investments (GP) 2 Ltd. v. Citigroup, 11-126, U.S. Court of Appeals for the Second Circuit, (Manhattan).