Remember this eye-popping news in Sept, 2011 “$50 Billion Claim of Havoc Looms for Bank of America” over a lawsuit arising from its troubled Merrill Lynch acquisition?
What is the outcome today? Reuters reported that a U.S. federal judge in New York on Monday refused to delay the approval process for a controversial $20 million settlement between Bank of America Corp Directors and shareholders who accused the bank of overpaying for Merrill Lynch & Co. U.S. District Judge Kevin Castel rejected as premature a request by another shareholder group, pursuing a similar lawsuit against Bank of America directors, to intervene in the New York case.
So the $20 m settlement is penut compared with the original $50 b claim.
How about anther victory for BAC?
Reuters reported that a New York judge on Tuesday 04/24/2012 rejected an effort by American International Group, Inc. and other objectors to Bank of America Corporation’s proposed $8.5 billion mortgage bond settlement to convert the case to a proceeding that may have widened its scope. New York state Supreme Court Justice Barbara Kapnick, who must decide whether to approve the settlement, denied the motion by AIG and other groups of investors to turn the limited proceeding known as an Article 77 into a broader inquiry known as a plenary action.
So both of billions of original litigation claims turn into merely $20 million settlement or none.
BAC is obviously going to the right direction, by settling more and more litigations with much less cash or liability outlay, its earnings will appear more and more attractive.
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