Citigroup on Wednesday won the dismissal of a lawsuit by Woori Bank over losses from mortgage-related investments, the third such defeat in a U.S. court for a South Korean bank that had been put under state control following financial crises.
Reuters reports that U.S. District Judge Laura Taylor Swain said Woori failed to prove that Citigroup acted fraudulently in selling it $95m of collateralized debt obligations backed by residential mortgage-backed securities.
In its May 2012 lawsuit, Woori contended that Citigroup knew the CDOs were backed by securities that could and did prove toxic.
In the meantime, the news agency reports that Deutsche Bank AG lost a bid Wednesday to end a shareholder lawsuit accusing it of misrepresenting the risk of packaging home loans into complex financial products.
U.S. District Judge Katherine Forrest in Manhattan denied a motion by the German bank to dismiss the lawsuit, which seeks class action status on behalf of investors accusing Deutsche Bank of scheming to maximize profits at their expense.
'Plaintiffs have certainly set forth sufficient plausible allegations to support a claim for a fraudulent scheme against Deutsche Bank', Forrest wrote.