Finders keepers, losers weepers is not always the law of the land.
Hedge funds are on the verge of reluctantly returning some $500 million that Citigroup
accidentally gave to them three years ago, a court filing shows.
In 2020, Citi because of a processing error, paid off a $894 million loan owed by bankrupt cosmetics company Revlon. Citi then sued to get back $500 million that wasn’t returned to it after discovering the error, from lenders to Revlon including Brigade Capital Management, HPS Investment Partners and Symphony Asset Management.
According to attorneys from both sides in a letter to the court Monday night, three defendants have indicated they are ready to sign an agreement to resolve the litigation, while other parties have made “substantial progress” toward a deal but aren’t in a positon to return the money.
In September, an appeals court ruled that lenders to Revlon did not deserve a huge windfall, overturning an earlier rule that they could keep the payouts.