Oh, how I wish I could report the judge who said that was one of our own. Maybe someday soon I’ll be able to do just that- but the story of the moment is Rakoff’s back!
It’s a new year, but so far, the same old (sad) song continues to play for Bank of America in the courtroom of Manhattan federal district court Judge Jed Rakoff, who’s overseeing the Securities and Exchange Commission’s suit against the beleaguered bank. On Monday, Rakoff ruled that BofA cannot present expert testimony asserting that media reports should have alerted shareholders to the billions it planned to pay Merrill Lynch executives after the 2008 merger.
In BofA’s answer to the SEC’s complaint, the bank’s lawyers from Cleary Gottlieb Steen & Hamilton and Paul, Weiss, Rifkind, Wharton & Garrison argued that numerous media outlets reported in advance of the BofA shareholder vote on the Merrill merger that Merrill execs were expected to receive billions in bonuses. That assertion echoed the bank’s filings with Rakoff last summer, when Cleary lawyers offered up affidavits from the likes of Stanford Law School professor Joseph Grundfest, who contended that such media reports were part of the total mix of information available to Bank of America shareholders. BofA’s point: Since shareholders should have known from media reports that bonuses would be paid, the bank’s decision not to mention those bonuses in pre-merger disclosure materials was not important…
Rakoff said that Grundfest’s testimony would be eliminated in its entirety. The ruling also bars portions of testimony offered by Stanford Law School professor Robert Daines and Columbia Business School professor R. Glenn Hubbard.
This past August, Bam Bam wrote Here’s a judge who took an oath of office, and lives up to it introducing Judge Rakoff to SLABBED readers.
…there’s a bona fide judge involved here, who swore to an oath, and guess what corp-o-thugs, this guy follows it. Judge Rakoff is ordering the parties to disclose who lied to conceal the bonuses, (he wants names), and why the SEC is colluding with this proposed order, to keep this all secret.
Bam Bam reported on Rakoff again in October and advised this is what happens when honest judges adhere to their oath of office.
Last Friday something tangible happened. The Board of Directors of BofA voted to abandon the lawyer-client privilege argument and cooperate in providing information.
According to the SEC agreement, BofA will specifically provide details of BofA’s failure to disclose “including any relevant information previously withheld based on attorney-client or other privileges.” I don’t know about you but I trust the SEC about as far as I can shot put their office building, but here’s the key: the agreement outlining what BofA is agreeing to provide has to be approved by Judge Rakoff.
Those of who did stay tuned, as Bam Bam suggested, were not surprised by Rakoff’s latest ruling:
In his ruling today, Rakoff said the SEC wants to exclude most or all of the bank’s experts. The judge said that at that this point he’d decide only the issue about media reports.
“The fact that the media were predicting, as the bank claims, that Merrill would in fact pay bonuses is entirely irrelevant to any aspect of this issue, for the alleged falsehood consisted of representing as a contingency what was in fact an agreement already reached,” Rakoff wrote.
representing as a contingency what was in fact an agreement already reached – Ring those bells!