Texas Instruments Inc. has sued Citigroup Inc., Morgan Stanley and Bank of New York Mellon Corp. for selling it $524 million in auction-rate securities that were supposed to be as good as cash but turned out to be impossible to sell.
The Dallas-based chipmaker says the three financial companies misled it into purchasing the securities by understating the risks of auction failures that would – and did – leave TI unable to cash out.
"TI has an absolute commitment to conducting business transactions in an ethical manner and holds its suppliers, partners, vendors to that same standard – banks are no exception," TI spokeswoman Kimberly Morgan said.
Citigroup, Morgan Stanley and Mellon declined to comment on the case.
