Citigroup Inc (NSE: C) was awarded a dismissal of a lawsuit from six of its former brokers that said they should not have to pay back the balance on their signing bonus loans which totaled $1.5 million.
Federal District Judge Lewis A. Kaplan granted New York granted Citigroup’s request to dismiss the lawsuit on Friday, saying “Having left the firm without repaying everything they owed, they brought this baseless lawsuit in what quite plainly was a studied effort to prevent collection of the debts they owed through the arbitration process.”
Former broker Thomas Banus sued Citigroup in August, amending the complaint in October to add five other former Citigroup brokers who received signing bonuses between $45,675 and $801,546. The group of plaintiff sought a class-action status for at least 500 brokers that were employed by Citigroup during the past six years who had received signing bonus loans.
Banus called the repayment requirement “unconscionable” in his complaint, saying that he shouldn’t have to pay the $39,000 signing bonus loan back all at once.
“We are extremely disappointed with Judge Kaplan’s decision,” the brokers’ lawyer, Mark Thierman of Reno, Nevada, said in an e-mail to the press.
