Citigroup Punts. Why?
TheWSJ and the WSJ Law Blog report that Citigroup picked up it's toys and decided to leave the game. According to the report there is an obscure provision in the bailout package, section 126(c), that says, in essence, that there shall be no liability against a third party for having acquired a target that otherwise was in an exclusivity agreement with someone else. Would this provision protect Board Members from shareholder suits?
In other words, there can be no liability for interfering with another's contract. Now I can understand a provision like that if it interfered with the Governments attempts to buy equity in a financial institution. But between private parties?
What a way to run the railroad: Contracts don't matter! This is a very odd public policy decision. I sure we will hear more about this matter at a later time.
