Update 4:35pm : Updates shares, adds Citi statement.
Revlon ( NYSE: REV ) fell 4.2% after a federal appeals court ruled that a group of the cosmetic company's creditor have to return $500 million that was accidentally sent to them by Citibank ( C ).
A group of three judges vacated the district court's decision and remanded the case to district court, according to the ruling viewed by Seeking Alpha.
Citigroup ( C ) originally lost the case in February of last year in its effort to recoup $900 million it had mistakenly transferred to Revlon ( REV ) lenders.
Citi ( C ) commented Thursday in a statement emailed to Seeking Alpha on the court's ruling.
"Today’s ruling reaffirms our long-held belief that these mistakenly transferred funds should be returned as a matter of law, as well as ethics," Citi wrote in the statement. "While Citi has taken steps to reduce the likelihood of such an error in the future, today’s decision provides welcome stability and upholds the concept of cooperation needed for a well-functioning syndicated lending market.”
The defendants — including Brigade Capital Management, HPS Investment Partners, and Symphony Asset Management plus seven others — claimed that they were owed the payment since Revlon ( REV ) was in default on a loan.
Citigroup ( C ) sued Brigade Capital Management in August 2020 to return its share of more than $900M that the bank mistakenly transferred to Revlon lenders.
The bank said wiring the money to Brigade and other lenders on Aug. 1 1 was the result of a clerical error.
For further details see:
Revlon drops after Citibank wins appeal in $500M transfer case (update)