Citigroup and Guy Hands set for courtroom showdown

Hands alleges that Citigroup tricked his company into buying EMI for £4bn in 2007.

Dubbed the "trial of the century" in London's financial circles, one of Britain's biggest private equity barons, Guy Hands, is set for a showdown with US-based Citigroup in a New York courtroom on 18 October.

Citigroup and the chairman of private equity firm Terra Firma have been fighting a bitter legal battle after Hands sued the banking group for fraud in December 2009.

He alleged that the head of Citigroup's UK investment banking business, David Wormsley, tricked Terra Firma into buying music-label EMI for £4bn in 2007.

Citigroup, rejecting the allegations, seeks to show that Hands's case against the bank was in retaliation against its refusal to write off some of EMI's debts in lieu of Terra Firma injecting further capital.

The bank also will claim in court that Hands and Wormsley dined out and went to the opera with their wives during a period when Hands apparently knew about the alleged fraud. Hands disputes this claim.

Hands is also expected to appeal to the jury's sympathy by naming the New York firefighters' pension fund - an investor in Terra Firma - as one of the victims of the alleged fraud by Citigroup.