By Jonathan Stempel
NEW YORK, Feb 19 (Reuters) - For Bank of America Corp and the U.S. Securities and Exchange Commission, it's now a waiting game.
U.S. District Judge Jed Rakoff on Friday received testimony he requested from New York Attorney General Andrew Cuomo, as the judge weighs whether to approve a $150 million settlement of two lawsuits by the SEC against Bank of America over the Merrill Lynch & Co takeover.
One lawsuit alleges the bank misled its shareholders about $3.6 billion bonuses it allowed Merrill to pay out. The other alleges it misled shareholders about Merrill losses, which reached $15.8 billion in the fourth quarter of 2008.
Rakoff has said he will rule on the $150 million settlement on Monday. If he rejects the settlement, a trial over the bonuses will begin on March 1. Rakoff in September rejected a different settlement over the bonuses.
Cuomo's office sent Rakoff excerpts of testimony of five people, including former Bank of America general counsel Tim Mayopoulos and officials from Merrill and Merrill's auditor Deloitte & Touche. The testimony was not released publicly.
The attorney general on Feb. 4 filed a civil fraud lawsuit against Bank of America, former Chief Executive Kenneth Lewis, and former Chief Financial Officer Joe Price over their actions in the merger.
'Obviously, these materials are only a small sub-set of the record compiled by the attorney general's office upon which our action is based,' wrote David Markowitz, Cuomo's investor protection chief, in a letter to Rakoff about the excerpts.
Lewis Liman, a Bank of America lawyer, in a Feb. 18 letter to Rakoff objected to the court's reviewing the transcripts in private, and requested disclosure to the parties and public.
Rakoff has questioned, among other things, the circumstances of Mayopoulos' firing on Dec. 10, 2008, and whether it might have been tied to his views of the Merrill merger.
The SEC, citing testimony from Lewis and others, has said Mayopoulos was let go to make room for Brian Moynihan, who might otherwise have left the bank. Moynihan is now Charlotte, North Carolina-based Bank of America's chief executive.
Bank of America has also said it would not agree to giving the SEC and the court a role in choosing a compensation consultant, a key focus of Rakoff at a Feb. 8 hearing.
Shares of the bank closed Friday unchanged at $15.88.
The cases are SEC v. Bank of America Corp, U.S. District Court, Southern District of New York, Nos, 09-06829 and 10-00215.
(Reporting by Jonathan Stempel; Editing by Gary Hill) Keywords: BANKOFAMERICA/SEC (jon.stempel@thomsonreuters.com +1 646 223 6317; Reuters Messaging: jon.stempel.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
NEW YORK, Feb 19 (Reuters) - For Bank of America Corp and the U.S. Securities and Exchange Commission, it's now a waiting game.
U.S. District Judge Jed Rakoff on Friday received testimony he requested from New York Attorney General Andrew Cuomo, as the judge weighs whether to approve a $150 million settlement of two lawsuits by the SEC against Bank of America over the Merrill Lynch & Co takeover.
One lawsuit alleges the bank misled its shareholders about $3.6 billion bonuses it allowed Merrill to pay out. The other alleges it misled shareholders about Merrill losses, which reached $15.8 billion in the fourth quarter of 2008.
Rakoff has said he will rule on the $150 million settlement on Monday. If he rejects the settlement, a trial over the bonuses will begin on March 1. Rakoff in September rejected a different settlement over the bonuses.
Cuomo's office sent Rakoff excerpts of testimony of five people, including former Bank of America general counsel Tim Mayopoulos and officials from Merrill and Merrill's auditor Deloitte & Touche. The testimony was not released publicly.
The attorney general on Feb. 4 filed a civil fraud lawsuit against Bank of America, former Chief Executive Kenneth Lewis, and former Chief Financial Officer Joe Price over their actions in the merger.
'Obviously, these materials are only a small sub-set of the record compiled by the attorney general's office upon which our action is based,' wrote David Markowitz, Cuomo's investor protection chief, in a letter to Rakoff about the excerpts.
Lewis Liman, a Bank of America lawyer, in a Feb. 18 letter to Rakoff objected to the court's reviewing the transcripts in private, and requested disclosure to the parties and public.
Rakoff has questioned, among other things, the circumstances of Mayopoulos' firing on Dec. 10, 2008, and whether it might have been tied to his views of the Merrill merger.
The SEC, citing testimony from Lewis and others, has said Mayopoulos was let go to make room for Brian Moynihan, who might otherwise have left the bank. Moynihan is now Charlotte, North Carolina-based Bank of America's chief executive.
Bank of America has also said it would not agree to giving the SEC and the court a role in choosing a compensation consultant, a key focus of Rakoff at a Feb. 8 hearing.
Shares of the bank closed Friday unchanged at $15.88.
The cases are SEC v. Bank of America Corp, U.S. District Court, Southern District of New York, Nos, 09-06829 and 10-00215.
(Reporting by Jonathan Stempel; Editing by Gary Hill) Keywords: BANKOFAMERICA/SEC (jon.stempel@thomsonreuters.com +1 646 223 6317; Reuters Messaging: jon.stempel.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.