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Bank of America Wriggles Off Hook Over Merrill Charges
Bank of America may have wriggled off the hook over a 2010 case in which they are accused of misleading shareholders regarding Merrill Lynch’s losses. Their violations of the False Claims Act could have cost them significantly more, but on April 5 a federal judge approved a $2.43 billion settlement between Bank of America and shareholders.
Reuters invited legal analysts Jacob Zamansky, a New York securities lawyer, to comment on the case, and he said, “Once shareholders have made their peace, they can’t take a second bite at the apple through the attorney general.”
What this means is that New York Attorney General Eric Schneiderman is hamstrung on this issue: he can either drop his claims for damages or he can fight against 2008’s decision by New York’s highest court that had established that once a settlement had been reached, further money can’t be sought.
“It limits the remedies that can be sought,” said William Jeffries, an attorney for Baker Botts.
As Bank of America has been wrangling with all sorts of miscellaneous lawsuits, much of them stemming from the 2007-2008 period, that they may have wriggled off the hook with a sober $2.43 billion settlement may be cause to celebrate. They will learn the news on what the case will look like on May 30.