Guy Hands and David Wormsley were still waiting for a verdict on Thursday afternoon in the three-week trial on which their reputations and those of Terra Firma and Citigroup depend.
Mr Hands, the usually restless private equity investor, sat reading quietly in his usual seat in the courtroom, flanked by a full team of highly paid lawyers, with the exception of David Boies, his lead counsel, who had flown to San Francisco for the Oracle-SAP trial.
Mr Wormsley, who as head of Citigroup’s UK investment banking business advised Mr Hands on some of his biggest deals before the EMI buyout drove them apart, read a novel called The Help. He was joined by his wife, Vicky, as his lawyers and others in the court flicked through newspapers.
Jurors ate lunch in the jury room having earlier requested pages of the transcript of the trial. They have been instructed to return a verdict by no later than 5pm on Friday.
The jury must reach a unanimous verdict, with the burden on Mr Hands’ Terra Firma group to prove that David Wormsley, once his closest adviser, misled him about a competing offer and that he would not have bid without this alleged advice.
Judge Jed Rakoff sent the eight-person jury off after the two sides’ lawyers presented impassioned final arguments in a case that could decide the fate of EMI and the reputations of Mr Hands and Mr Wormsley.
Mr Boies told the jury Mr Wormsley had made “false statements”, while Mr Hands’ testimony was supported by his colleagues. “He couldn’t have made it up if he told other people at the time,” he argued.
Ted Wells, Citigroup’s lead counsel, said: “David Wormsley did not lie to Guy Hands.” Mr Hands’ argument that he bid 265p per EMI share on May 21 2007 only because Mr Wormsley had purportedly told him there would be a rival Cerberus bid at 262p, “defies common sense” and was supported by “not one e-mail, not a text, not a file memo”, Mr Wells said.
“These people write everything down,” he charged, noting that the copious documentation disclosed in the trial had revealed myriad other details, including the smoked salmon and pea and cucumber soup appetisers the two men ate at the Royal Opera House.
Mr Boies argued that Terra Firma routinely avoided auctions and had hoped until the final hours of the process to negotiate a lower bid price. Mr Wells countered that Terra Firma documents showed it had been planning a 265p per share bid “from day one”.
Mr Boies noted the £70m in fees and £400m in interest Citigroup had earned from the transaction, arguing that the bank encouraged Terra Firma’s bid in a search for “a way out” of its already troubled unsecured loans to EMI.
Mr Wells said Citigroup had lost $2bn (£1.2bn) on the deal in loan write-offs. “We have got to live with our bad business decision and so does [Mr Hands],” he said. Instead, he argued, Mr Hands had “made up” his case to shift responsibility for a bad deal, and had “[thrown] David Wormsley over the side” because he had 60 to 70 per cent of his own wealth tied up in EMI.
Terra Firma argued for damages of £1.32bn, while Citigroup argued that damages should be nothing, or no more than $46.5m.
Terra Firma had believed it could turn a £1.5bn equity investment into £4bn, Mr Wells said. “They believed it was a gold mine. [It was] fool’s gold.”