Citigroup may have caved in to the New York state comptroller, Alan Hevesi, and his lawyers when it offered $2.65 billion in May to settle a suit brought by investors who lost money on WorldCom securities. But in a little-noticed but encouraging development, the other 16 banks that Mr. Hevesi, the lead plaintiff in the class-action case, sued are holding their ground.

The Citigroup settlement, one of the largest ever in a securities class-action suit, will put as much as $144.5 million into the pockets of the two law firms that represented Mr. Hevesi. As these columns reported on May 14, the law firms and individuals and committees with ties to them donated $121,800 to Mr. Hevesi’s campaign coffers in the year before an aide to Mr. Hevesi signed a retainer agreement with the firms that set their fees.

The other underwriters, which include J.P. Morgan Chase & Co.,Bank of America, DeutscheBank, Lehman Brothers, Blaylock, CS First Boston, Goldman Sachs, UBS Warburg, ABN/Amro, Utendahl Capital Partners LP, Tokyo-Mitsubishi International PLC, Westdeutsche Landesbank, BNP Paribas, Fleet Securities, Mizuho International, and Caboto, had 45 days to opt into the settlement under the terms to which Citigroup agreed. All declined. Sources from both sides expect that the matter will go to trial in January.

Here’s hoping they are right and that the other underwriters don’t follow Citigroup’s example. A trial would give the securities firms an opportunity to make the common-sense argument that they should not be penalized for investors’ decisions. When Mr. Hevesi’s predecessor bought the WorldCom stocks and bonds, he was a sophisticated investor who had weighed the risks and the returns. It’s one thing to try to recover from individual WorldCom executives who pleaded guilty to fraud. But suing the company itself, or the banks who served the company and who were themselves victims of the fraud, doesn’t help anyone but the trial lawyers and the politicians seeking contributions from them.

If these banks did anything wrong in the WorldCom case, there are plenty of opportunities for action by the appropriate prosecutors or the Securities and Exchange Commission. Mr. Hevesi and his trial-lawyer contributors are not those. Since so many banks dealt in the World-Com stocks and bonds without detecting the fraud, the case against the banks would have been a tough one to make, even for Mr. Hevesi’s hundred-million dollar lawyers.

The $2.65 billion Citigroup will pay out to Mr. Hevesi, his co-plaintiffs, and their attorneys come out of the pockets of Citigroup investors. Ironically, those include the pensioners whose interests Mr. Hevesi is supposed to represent. The New York State Common Retirement Fund, on whose behalf Mr. Hevesi sued, holds $1.2 billion of Citigroup stock, according to the fund’s most recent quarterly report to the Securities and Exchange Commission. The fund is likewise invested in many of the other banks from which it is now trying to extract payoffs. As of its SEC filing, which was current as of the end of March, the fund owned $436 million in Bank of America Corp. stock, $244.2 million in FleetBoston Financial Corp., and $400 million in J.P. Morgan Chase & Co.

So whatever Mr. Hevesi and his attorneys wrangle from these banks will mean big money for the lawyers — at the expense of shareholders. J.P. Morgan, which just issued a quarterly earnings report, reported a $548 million net loss after it increased its litigation reserves by $2.3 billion. With any luck, it won’t have to dip into those reserves over this WorldCom affair, but will instead join its co-defendants in court in January and score a victory for shareholders and common sense over the trial lawyers and the politicians who do their bidding. Or, better yet, Mr. Hevesi will come to his senses and drop this lawsuit.