Citigroup Settles $70 Million Trade-Loss Suit With Loomis Sayles

Citigroup Inc. has resolved a lawsuit filed four years ago by Loomis, Sayles & Co. claiming the bank caused more than $70 million in losses while executing trading orders that swamped the market.

The parties on Tuesday told a federal judge in a one-page filing that they agreed to drop the case, without the ability to refile it. The document doesn’t disclose any financial terms of the agreement.

Boston-based Loomis Sayles sued in 2022, claiming it lost money in a series of trades on March 18 in which Citigroup’s global markets unit acted as its broker. The investment firm alleged it had instructed Citi to buy almost 800,000 shares of Shopify Inc. and sell more than 5 million shares of Colgate-Palmolive Co. in a way that wouldn’t move daily market prices.

Instead, the bank placed the orders into an illiquid closing auction at the end of the day, resulting in “artificially dislocated prices” that cost it money, according to a complaint filed in Manhattan federal court.

Loomis Sayles declined to comment Tuesday. Citi didn’t immediately respond to a request for comment.

In January, Loomis Sayles told the judge overseeing the case that both sides were pursuing settlement discussions. The judge suspended an April trial date in the case.

The case is Loomis Sayles v Citigroup Global Markets Inc., 22-cv-6706, US District Court, Southern District of New York.

Top photo: A worker enters Citigroup headquarters in New York, on Thursday, Aug. 4, 2022. Bloomberg.