Owner Guy Hands this week submitted documents to a US court relating to the case, which a source told the Daily Telegraph "could run for years". Terra Firma acquired EMI for Â£4.2 billion ($6.58 billion) in August 2007.
"Citigroup's conduct in the EMI transaction was entirely proper. We are confident the appeals court will confirm that Terra Firma received a fair trial," a spokesman for Citigroup stated in response to the news.
EMI, which boasts major artists including Kylie Minogue and Katy Perry on its roster, reported pre-tax losses of Â£1.75 billion for the financial year ending in March 2009. Citigroup provided Â£2.6 billion to fund the Terra Firma buyout.
Last weekend, the Observer reported that control of the label could be handed over to Citigroup within a matter of weeks for around Â£1.5 billion.
By Claire Archer