It still may be too soon to tell whether there will be a tsunami of litigation over credit-default swap agreements gone bad, as some have predicted. But it’s probably a safe bet that litigation initiated by a hedge fund against Citigroup and Wachovia won’t do much to roil the waters.

Last November, we reported that Manhattan federal district court Judge Barbara Jones dismissed a suit filed by VCG Special Opportunities Master Fund against Citigroup over a $10 million swap. VCG’s suit against Wachovia didn’t fare much better. On Monday, Manhattan federal district court Judge Laura Swain dismissed seven out of eight causes of actions brought by VCG against Wachovia, which is now owned by Wells Fargo.

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