Six former brokers at Citigroup Inc.'s Smith Barney unit have lost a lawsuit against the banking company to evade repaying the remainder of their signing bonuses, which totaled $1.51 million.

The brokers argued that their contracts with Citigroup to repay the signing bonuses were, in theory, void because Citigroup was "mismanaging its company to the point that it could no longer provide the security required by each [broker's] clients and [was] penalizing [brokers] with reduced compensation because of its own failures."

U.S. District Judge Lewis Kaplan in the Southern District of New York dismissed the lawsuit against Citigroup on Friday. Kaplan ruled that the lawsuit was "baseless" and "quite plainly was a studied effort to prevent collection of the debts they owed."

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.