Board of Trustees v. Citigroup Global Markets Inc., No. 09-13451
Denial of Motion to Compel Arbitration Reversed
In Board of Trustees v. Citigroup Global Markets Inc., No. 09-13451, an appeal from the district court's denial of defendant's motion to compel arbitration, the court reversed where plaintiff's officer had implied actual authority to bind plaintiff to arbitrate disputes arising under the consulting contract at issue.
As the court wrote: "This appeal from the denial of a motion to compel arbitration presents the question whether the Board of Trustees of the City of Delray Beach Police and Firefighters' Retirement System agreed to arbitrate a dispute arising under its consulting contract with Citigroup Global Markets, which helped the Board evaluate the performance of several investment managers of pension funds the Board oversees. The Board complained that Citigroup abused its position as pension consultant when it provided erroneous reports about the performance of the investment managers of the fund, recommended investment managers who would agree to place trades through Citigroup, and engaged in self-dealing transactions with assets of the fund. Citigroup moved to compel arbitration on the ground that William Adams, the chairman of the Board, had bound the Board to arbitrate any dispute with Citigroup when he signed several account agreements through which one of the investment managers of the fund could buy and sell securities. Those account agreements required arbitration of disputes under those and "any other agreement between" Citigroup and the Board."
- Read the Eleventh Circuit's Decision in Board of Trustees v. Citigroup Global Markets Inc., No. 09-13451
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