Clothier Sues Citigroup Over $258M In Illiquid ARS

Law360, New York (February 5, 2009, 12:00 AM EST) -- Clothing retailer American Eagle Outfitters Inc. has sued Citigroup Global Markets Inc., claiming the bank fraudulently induced the company to purchase auction rate securities and then left it stranded with $258 million in now-illiquid ARS.

American Eagle lodged the suit Wednesday in the U.S. District Court for the Western District of Pennsylvania, accusing the investment bank of violating federal and state securities laws, as well as fraud and negligent misrepresentation.

According to the complaint, American Eagle began purchasing ARS from Citigroup in October 2002 after Citigroup...
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