VOL. 124 | NO. 51 | Monday, March 16, 2009
Judge: Will Rule in Week on Merrill Bonus Case
By DAVID B. CARUSO | Associated Press Writer
NEW YORK (AP) - A judge said Friday he will decide within a week whether Bank of America Corp. has to turn over a list of performance bonuses given to the 200 highest paid employees of Merrill Lynch & Co.
State Supreme Court Justice Bernard Fried didn't indicate how he would rule, but during the court hearing he questioned Bank of America's claim that salary information was a trade secret and suggested he was unlikely to order confidentiality merely to save Merrill Lynch workers from a public shaming. He said he planned on issuing a decision by next Friday.
New York Attorney General Andrew Cuomo has subpoenaed the list of names and bonuses as part of his investigation into the circumstances surrounding the brokerage firm's acquisition by Bank of America last winter.
Lawyers for Bank of America said they fear that Cuomo will make those pay details public, possibly embarrassing workers and disclosing sensitive company information.
The bank has asked the court to allow it to submit the information on bonuses without the names of the workers who got them, or enter an order forbidding Cuomo from disclosing the information.
"People care about their privacy," the bank's attorney, Evan Davis, told the judge. He also argued that the bonus information was effectively a trade secret. "Our competitors want this information," he said.
A lawyer for the attorney general, Eric Corngold, said the information had been requested as part of an official law enforcement investigation and Bank of America had no right to withhold it.
"We can't have the subjects of an investigation telling the attorney general who he can subpoena," he said. A temporary court order is in place that is keeping the employee names confidential for now.
Bank of America, based in Charlotte, N.C., acquired New York-based Merrill on Jan. 1. Shortly before the deal became final, Merrill paid out $3.6 billion in bonuses, split among some 40,000 employees.
The payments have been a source of much criticism, largely because Bank of America is a major recipient of federal bailout funds.
Cuomo has asked several banks to turn over information on executive pay and bonuses. As part of the investigation, his office has interviewed Bank of America executives and former Merrill chief executive John Thain about the circumstances of the payouts.
The attorney general and U.S. Rep. Barney Frank, D-Mass., have also written Bank of America saying the public is entitled to the information because of the $45 billion in bailout money.
Bank of America shares rose 7 cents to $5.92 in Friday afternoon trading.
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