NEW YORK (Reuters) - Bank of America Corp has agreed to pay $150 million to settle a class-action lawsuit accusing the former Merrill Lynch & Co of misleading investors in connection with the sale of bonds and preferred stock, court records show.
U.S. District Judge Jed Rakoff on Aug 21 granted preliminary approval to the settlement, which was made public on Monday. He scheduled a Nov 23 hearing to grant final approval.
The plaintiffs had accused Merrill of issuing false and misleading prospectuses and registration statements in connection with the offerings, which were made between 2006 and 2008.
Two Louisiana pension funds, the Louisiana Sheriffs’ Pension and Relief Fund and the Louisiana Municipal Police Employees’ Retirement System, were the lead plaintiffs in the case. Close to 20 former Merrill executives and directors were named as defendants, including former chief executives Stanley O’Neal and John Thain.
Bank of America acquired Merrill Lynch & Co on Jan 1, creating the largest U.S. bank by assets. A representative of the bank was not immediately available for comment.
The case is In re Merrill Lynch & Co Inc Securities, Derivative and Erisa Litigation, U.S. District Court, Southern District of New York (Manhattan), No. 07-9633.
Reporting by Jonathan Stempel; Additional reporting by Elinor Comlay, Joe Rauch; editing by Leslie Gevirtz
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