Citigroup Incorporated announced Monday it has filed a lawsuit in New York Supreme Court against Wachovia, Wells Fargo, and the directors of both banks seeking more than $60 billion in damages for interfering with Citigroup's planned takeover of Wachovia's banking operations. The lawsuit seeks more than $20 billion in compensatory damages and more than $40 billion in punitive damages from Wells Fargo for interference. Citigroup also seeks relief from Wachovia for what it called its bad-faith breach of contract. Early last week, Citigroup agreed to purchase Wachovia's banking assets for $2.2 billion, though it demanded government guarantees. However, on Friday Wells Fargo announced that it agreed to acquire all of Wachovia in a deal worth $15.1 billion. Wells Fargo's deal did not require any government support. Meanwhile, Federal Reserve (Fed) officials have been in talks with Wells Fargo and Citigroup in the hope of getting the parties to come to an agreement. “This was always a deal Citi wanted rather than one we needed,” Citigroup said in a statement Monday. “We were and remain very excited about this transaction and how it will benefit the clients and shareholders of Citi and Wachovia, as well as help preserve the stability of the financial system.” However, Wachovia had a different assessment of the situation, saying its deal with Wells Fargo would be better for all parties. “Wachovia continues to believe its agreement with Wells Fargo, which involved no government assistance, is proper and valid,” Wachovia spokeswoman Christy Phillips-Brown said in an e-mail to the Associated Press. “The agreement is in the best interests of shareholders, employees, creditors, and retirees as well as the American taxpayers.”
