The legal proceedings launched by Citibank as it seeks to fix a $900 million payment mistake continue at the New York Southern District Court.

Let’s note that the lawsuit concerns wire transfers from August 11, 2020 regarding Revlon’s 2016 Loan. In 2016, Revlon acquired Elizabeth Arden, Inc. The deal was partially facilitated by a seven-year, $1.8-billion loan. Citibank serves as the administrative agent and collateral agent for the loan.

On August 11, 2020, several months of accrued interest came due under a credit agreement. The interest payment was to be processed by Citibank in its capacity as administrative agent. No other amount was due at the time, and Revlon transferred no additional funds to Citibank.

The interest payment was processed by Citibank on August 11, 2020. Due to issues with the loan-processing system, the payment to each lender was on average more than 100 times the interest that was actually due.

This operational mistake caused Citibank to transfer approximately $900 million of its own money to parties that were not entitled to it. When Citibank discovered the mistake, it promptly asked the recipients to return its money. Some recipients did return the money, but some did not. Now, the bank is trying to get the money back.

On November 13, 2020, the parties in this case submitted a preliminary trial report. The document includes a list of witnesses that the parties plan to call in order to support their sides of the story.

Citibank’s witness list, seen by FX News Group, includes a number of Citibank’s managers.

• Vincent Farrell, who is the head of North American Loan Operations at Citibank, will testify regarding the loan documentation and databases used at Citibank to record and track, among other things, the composition of a lender syndicate for a particular loan, including the Revlon 2016 Term Loan.

Mr Farrell will also testify about the August 11, 2020 wire transfers that were mistakenly made by Citibank in connection with a “rollup” transaction that took place on that date with respect to the Revlon 2016 Term Loan, including calculation statements that were sent, prior to the mistaken wire transfers, to lenders holding portions of that Loan.

He will further testify as to efforts that were made on August 12, 2020 to understand what happened, his involvement in addressing the mistake and efforts that were made to get the mistakenly transferred funds back by, among other things, sending recall notices to defendants and/or their lenders funds on August 12, 2020 and the following several days.

• Another witness is Vincent Fratta – a Loan Agency Senior Manager in Citibank’s Global Loans Operations Group, focusing on North America. He will testify about the circumstances giving rise to the mistaken wire transfers on August 11, 2020, including his role as the Citibank “approver” for the transaction.

Fratta will testify that, at all times, it was his intention to transfer to lenders only the interest payment received from Revlon earlier that day. He will also testify about his role in discovering the mistake and communicating about the mistake to relevant Citibank personnel.

• Citibank’s list of witnesses also includes Arokia Raj, who is an employee of Wipro Limited. He works exclusively for Citibank under the supervision of Vincent Fratta.

Mr Raj will testify about the circumstances giving rise to the mistaken wire transfers on August 11, 2020, including his role as the “checker” who reviewed the transaction in Citibank’s loan processing system. He will testify that, at all times, it was his intention to transfer to lenders only the interest payment received from Revlon earlier that day. He will further testify about how he discovered the mistake on the morning of August 12, and his communications with Mr. Fratta upon discovery of the mistake.

• The list also includes Santosh Ravi, an employee of Wipro Limited. He works exclusively for Citibank under the supervision of Vincent Fratta. Mr. Ravi will testify about the circumstances giving rise to the mistaken wire transfers on August 11, 2020, including his role as the “maker” in creating the transaction in Citibank’s loan processing system.

He will testify that at all times, it was his intention to only transfer the interest payment received from Revlon earlier that day to the lenders. He will also testify about how the mistake occurred.

• Brendan Zeigon, who is the Global Head of Loan and Risk Management Services Operations at Citibank, will testify that the overpayment made by Citibank to lenders under the Revlon 2016 Term Loan on August 11, 2020 was a mistake.

Zeigon will further testify as to efforts that were made on August 12, 2020 to understand what happened, his involvement in addressing the mistake and efforts that were made to get the mistakenly transferred money back by, among other things, sending recall notices to defendants and/or their lender funds on August 12, 2020 and the following several days.

Citibank is asserting four causes of action under New York law: (i) unjust enrichment; (ii) conversion; (iii) money had and received; and (iv) payment by mistake. All claims remain to be tried.