Class Action Filed Against Bank of America and Merrill Lynch and Their Officers and Directors

A class action lawsuit has been filed in the Southern District of New York, claiming that BofA and Merrill Lynch and their respective officers and directors made false and misleading statements in the proxy materials for the December 5 vote regarding the Merrill deal. The complaint alleges that the true nature of Merrill’s financial condition was not revealed even though Merrill and BofA knew or should have known of the large losses at Merrill Lynch.

“[Former Merrill Lynch CEO John] Thain reported that Merrill suffered significant losses in November, which Thain described as one of the worse months in Wall Street history. Despite the size of these losses, Thain told Merrill’s board the losses were in line with BOA’s estimates,” says the complaint. “Neither BOA nor Merrill, nor any of the Individual Defendants, ever disclosed any such estimates... to their shareholders in the Proxy Statement. Likewise, no loss estimates were disclosed in any subsequent filings.”