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Coughlin Stoia Geller Rudman & Robbins LLP Files Class Action Suit Against Bank of America Corporation

^{Published on 2009-12-22 13:10:11 - Market Wire}
 

SAN DIEGO--([ BUSINESS WIRE ])--Coughlin Stoia Geller Rudman & Robbins LLP ("Coughlin Stoia") ([ http://www.csgrr.com/cases/bankofamerica/ ]) today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the Southern District of New York on behalf of purchasers of certain Bank of America Corporation ("BofA") (NYSE:BAC) debt securities (the "Securities") ([ http://www.csgrr.com/cases/bankofamerica/attachment_A.pdf ]) during the period between September 15, 2008 and January 21, 2009 (the "Class Period").

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Darren Robbins of Coughlin Stoia at 800/449-4900 or 619/231-1058, or via e-mail at [ djr@csgrr.com ]. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at [ http://www.csgrr.com/cases/bankofamerica/ ]. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

The complaint charges BofA and certain of its officers and directors with violations of the Securities Exchange Act of 1934. BofA is a financial holding company, which provides a range of banking and nonbanking financial services and products in the United States and internationally

The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding BofA's proposed merger with Merrill Lynch & Co., Inc. ("Merrill Lynch") and concealed BofA's agreement that Merrill Lynch employees would receive up to $5.8 billion in bonuses before the merger was consummated. Defendants also failed to disclose massive losses Merrill Lynch suffered – and BofA was inheriting – after the merger was announced. As a result of defendants' false and misleading statements, BofA Securities traded at artificially inflated prices during the Class Period. BofA took advantage of this inflation by selling certain debt and equity securities, including 455 million shares of its common stock at $22 per share in a secondary common stock offering on October 10, 2008, which raised some $10 billion of desperately needed capital.

On September 15, 2008, BofA announced that it had entered into an Agreement and Plan of Merger with Merrill Lynch. On December 5, 2008, shareholders of both BofA and Merrill Lynch overwhelmingly approved the merger. Thereafter, on January 16, 2009, BofA announced its first quarterly loss in 17 years. BofA announced a $1.8 billion loss for the fourth quarter of 2008, citing deeper trading and loan losses. The Company further slashed its dividend from $0.32 to a penny a quarter. In addition to its own losses, BofA reported that Merrill Lynch's preliminary results for the fourth quarter of 2008 indicated a net after-tax loss of $15.3 billion. BofA further confirmed that it would receive an additional $20 billion in assistance from the U.S. government and that the government had agreed to provide guarantees against further Merrill Lynch losses of $118 billion, with BofA covering the first $10 billion. Over the course of the next several days, details began to emerge concerning the truth behind BofA's deal with Merrill Lynch, including the fact that BofA had learned of Merrill Lynch's substantial fourth quarter losses prior to completing its acquisition of Merrill Lynch.

On January 21, 2009, The Financial Times reported that Merrill Lynch had paid $3 to $4 billion in bonuses prior to the closing of the merger, notwithstanding the multi-billion dollar losses Merrill Lynch had suffered in 2008. In contrast, Merrill Lynch's top executives did not receive year-end bonuses in 2007 because of losses much smaller than those the firm suffered in 2008.

Plaintiff seeks to recover damages on behalf of all purchasers of certain BofA debt securities during the Class Period (the "Class"). The plaintiff is represented by Coughlin Stoia, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Coughlin Stoia, a 190-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Coughlin Stoia Web site ([ http://www.csgrr.com ]) has more information about the firm.