In an opinion issued today, Judge Stein dismissed the securities fraud claims of a putative class of Citigroup investors led by a United Kingdom-based pension fund. The claims were based on Euro Notes issued by Citigroup between 2005 and 2009 and sold to investors through the Luxembourg and Copenhagen Stock Exchanges. The complaint alleged that the Notes were artificially inflated due to Citi’s failure to disclose the risk of its exposure to mortgage-backed securities and other collateralized debt obligations. Though the defendants were located in New York, and certain of the conduct occurred here, Judge Stein dismissed the case on forum non conveniens grounds.
At bottom, the relevant financial transactions and regulatory oversight took place in the United Kingdom and continental Europe. In this litigation, a U.K. plaintiff has alleged claims under Luxembourg law regarding European-listed and European-regulated securities. That the U.K. plaintiff has sued New York defendants does not shift the center of this controversy across the Atlantic and into New York. The balance of interests dearly favors the United Kingdom as the more appropriate forum for this action.