Terra Firma set to appeal EMI ruling

Guy Hands’ Terra Firma is set to appeal the December court decision which ruled that the firm’s bank, Citi, did not trick it into buying music publisher EMI Group.

Terra Firma had sued its bank for what could have been as much as £7 billion (€4.9 billion; $6.4 billion) in relation to the 2007 acquisition of EMI, an accusation that Citi had labelled “irresponsible” following the jury’s ultimate decision to find Citi not liable.

EMI: The dispute plays on

“Boies, Schiller and Flexner, on behalf of Terra Firma, filed a notice of appeal in the litigation against Citigroup. The appeal will challenge legal rulings made by the court in the litigation,” Terra Firma told Bloomberg.”Terra Firma remains committed to working on a resolution for EMI that will benefit all parties involved.”

The dispute has now been ongoing for more than a year, as Terra Firma first filed the suit in December 2009. The high profile trial, which kicked off in New York in late October 2010, lasted less than three weeks and saw Terra Firma founder Hands testifying against his long-time banker and friend David Wormsley.

“As the jury unanimously found after a three-week trial presided over by a distinguished federal judge, Citigroup's conduct in the EMI transaction was entirely proper,” said Citi in a statement. “We are confident the appeals court will confirm that Terra Firma received a fair trial.”

The jury ruled against Terra Firma after less than a day of deliberation. Terra Firma subsequently had 30 days from the final judgement in December to file a notice of appeal. The Federal appeals court will now come up with a timetable for Terra Firma to lodge the grounds on which it intends to appeal.

Last year Terra Firma was obliged to inject £100 million in fresh equity into EMI in order to prevent it breaching its banking covenants and passing into the hands of its lender Citi. The next test of the banking covenants is due at the end of March.