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Citibank on Trial for Colombian Hedging Scam Asks About Plain Vanilla As Plaintiff Rests

By Matthew Russell Lee, Patreon Maxwell Book
BBC - Honduras - CIA Trial Book - NY Mag

SDNY Courtroom, Sept 7 – Colombian sugar producer Mayaguez sued Citibank for ripping it off on hedging transactions. Now the case is coming to trial, albeit a bench trial. 

 On August 19, 2022 U.S. District Court for the Southern District of New York Judge Paul G. Gardephe held an in-person final pre-trial conference with a dozen lawyers, most of them for Citibank. Inner City Press went and covered it.  

The plaintiff is represented by Quinn Emanuel, which made a point that they had tried to bring a few lawyers as possible. The Citigroup team from Shearman & Sterling took up half of the gallery (the rest was empty, other than Inner City Press).

   In preparation for the bench trial, Team Citibank sought and obtained an order to allow them to bring in trial supplies, small dolly, sealed water bottles to and from the courtroom. There is a separate order for technological equipment.   

 Mayaguez filed a motion in limine to exclude evidence about an internal audit. But it being a bench trial, the potential for prejudice is small. Judge Gardephe let it in.

On August 22 the trial began, and Inner City Press was present, apparently the only media in a gallery otherwise full of corporate lawyers. Threadette here:

OK- now in trial against Citibank by Colombia sugar manufacterer Mayaguez. Courtroom gallery jammed with corporate lawyers, printers, boxes of documents.

Citi reduced Mayaguez to junk status. Witness links it to over-hedging. Citi moves to strike.

On the screen, slides about FX Collar Targeted Payout and "Limited Compensation Collar is not a hedge."

In the docket, the two sides on August 22 jointly asked Judge Gardephe to "direct the Clerk of Court to remove the trial exhibits filed at the following docket numbers: ECF Nos. 238, 239 etc etc etc 367, and 368." And a visit to the docket at 5:30 pm on August 22 found "You do not have permission to view this document."

On August 23, another expert was on the stand, being asked about his report a slide entitled "Restitutio in Integrum." In the gallery, more boxes: a snacks (Blue Diamond nuts were visible), and full boxes each witnesses like Alarcon, Mauricio and Veronesi.

On August 24, a witness was on the stand in Spanish, interpreted consecutively, asked if he thought the transaction had been approved by the CEO of Mayaguez. He said he had seen no written proof of approval. Now the boxes in the gallery had multiplied or spread, now taking up the back three rows on both sides, including a box for "Lina Cross."

On September 5, Labor Day, Citibank submitted to the Court a slew of Colombian court decision, as far back at 1945.

On September 6, the day the SDNY made COVID masks voluntary, the trial resumed. The witness was being asked, through the still-masked interpreter, about the "marketing" department. It was pointed out this was Markets. The answers didn't vary.

On September 7 in a courtroom in which everyone, it seemed, had a laptop, the plaintiff rested it case, after a flurry of questions to a witnessness including about "plain vanilla" transactions. The defense of course is ready. This could take a while.

The case is Mayaguez S.A. v. Citigroup Inc. et al., 16-cv-6788 (Gardephe)


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