NEW YORK ( TheStreet) -- A New York judge has ruled a lawsuit brought against Citigroup ( C) by certain bondholders over supposed "misstatements" related to collateralized debt obligations backed by subprime mortgages can move forward, the Wall Street Journal reported on Monday. The lawsuit claims that Citigroup "failed to disclose" its exposure to $66 billion worth of CDOs and other mortgage-backed assets, with subprime mortgages underlying them. The bondholders involved in the case bought Citigroup bonds in a series of offerings between May 2006 and August 2008. Citigroup raised more than $71 billion in the offerings, the Journal says, however those bonds significantly sank in value in late 2008 after Citigroup's exposure to the securities was exposed, the lawsuit claims. Citigroup took $45 billion in government bailout funds in November 2008. It has since repaid $20 billion. The U.S. Treasury, which converted $25 billion worth of preferred stock into common shares last year, is in the process of selling its stake in the company in the open market. The ruling found that the bondholders did have cause to bring some of their claims forward regarding Citigroup's CDO exposure, because the bank made 48 bond offerings during the two-year period that used the same three registration statements, the Journal says. The Journal added that the court dismissed other claims related to Citigroup's statements on exposure to $100 billion in structured investment vehicles also backed by subprime mortgages and $11 billion in auction-rate securities, which the bondholders claimed were illiquid. A Citigroup spokeswoman told the Journal that the bank was "pleased that some claims were dismissed, and will vigorously defend the remaining claims on the merits." Citigroup shares rose 0.7% to $4.14 on light volume of 386 million shares on Monday. --Laurie Kulikowski in New York.