On September 8, 2015, the Southern District of New York
dismissed, for lack of jurisdiction, a large portion of claims from
a derivative class action alleging that Citibank NA, as trustee of
27 trusts, had breached its contractual, statutory, and common law
duties in connection with $17 billion of pooled loans. Plaintiffs
invoked federal jurisdiction based on the Trust Indenture Act of
1939 ("TIA") and asked the court to take supplemental
jurisdiction over the accompanying state law claims. Plaintiffs
asserted TIA claims in connection with just 3 of the 27 trusts. The
court held that those claims could proceed, denying Citibank's
argument that the TIA does not provide a private right of action.
However, the court declined to exercise supplemental jurisdiction
over state law claims relating to the other 24 trusts. The court
concluded that supplemental jurisdiction was permissible, but that
it should nonetheless decline such jurisdictions because the claims
as to each
