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BofA, female brokers settle bias case over bonuses

NEW YORK (Reuters) - Bank of America CorpBAC.N has settled a federal lawsuit alleging it discriminated against female brokers at the former Merrill Lynch & Co by offering them lower retention bonuses than male counterparts.

A Bank of America advertisement is seen outside one of its branches in New York July 21, 2008. REUTERS/Shannon Stapleton/Files

The June 2009 lawsuit contended that Merrill had habitually steered wealthier clients to male brokers, and that this led to lower retention bonuses for female brokers because payouts were based on “production,” or fees earned on client assets.

Retention bonuses are often awarded to brokers who work at companies being acquired to keep them from defecting. They can reach seven-figure sums for top producers. Bank of America bought Merrill on Jan. 1, 2009.

U.S. District Judge Shira Scheindlin revealed the settlement in an order filed Tuesday with the federal court in Manhattan. Terms were not disclosed.

Charlotte, North Carolina-based Bank of America has said it awarded retention bonuses based on merit, and did not discriminate.

According to the complaint, the plaintiff Jaime Goodman had worked for Merrill for more than 16 years and been “a $1 million producer for nearly a decade,” but would have performed even better and gotten a higher retention bonus absent discrimination.

“We have reached an amicable resolution and Ms. Goodman is pleased that the litigation is over,” Goodman’s lawyer, Linda Friedman, said in an email.

Bill Halldin, a Bank of America spokesman, declined to comment.

Large U.S. banks and brokerages are frequent targets of gender bias lawsuits. Citigroup Inc and Morgan Stanley are among other financial companies to settle such lawsuits in the last few years.

The case is Goodman et al v. Merrill Lynch & Co et al, U.S. District Court, Southern District of New York, No. 09-05841.

Reporting by Jonathan Stempel, additional reporting by Ernest Scheyder; Editing by Bernard Orr