RENO, Nev. (AP) — Attorneys for Goldman Sachs and Co. say the city of Reno shouldn’t seek millions of dollars in damages from the bank through arbitration and needs to go through federal courts.
The Reno Gazette-Journal reports the court filing comes after the city filed a claim with the Financial Industry Regulatory Authority in February. It sought arbitration against Goldman Sachs over $210 million in bonds the city issued with the bank’s help.
The special Auction Rate Securities market the bonds were issued on seized up in 2008 after big banks stopped supporting it.
Reno now must pay 15 percent interest on the bonds plus millions in fees on debt it issued for an events center and railroad project.
Goldman Sachs argues the city’s only trying arbitration to circumvent a statute of limitations.