Manhattan Commercial Division Justice Saliann Scarpulla has entered an interim stay of an $8.5 billion settlement deal between Bank of America and institutional investors in mortgage-backed securities before deciding whether to postpone finalizing the judgment.

The order late Tuesday was spurred by a motion request from American International Group, an investor which has opposed the settlement by arguing it short-changes investors and was not made in good faith due to conflicts of interest among counsel for trustee Bank of New York Mellon and Bank of America.

AIG wants to indefinitely postpone entry of final judgment to allow “the many issues that were left open” in Justice Barbara Kapnick’s Jan. 31 decision to be litigated, according to court papers.

According to a brief submitted by Mark Zauderer, partner at Flemming Zulack Williamson Zauderer, who is co-counsel to AIG with Reilly Pozner’s Daniel Reilly and Jones & Keller’s Michael Rollin, last Friday’s ruling “fails to address many questions,” including how much distribute to each of the 530 securitization trusts at issue, which trusts should be covered under the settlement, and how the proceeds should be allocated.

“Critical features of the Settlement were not addressed in the Decision and, no doubt, will be the subject of future litigation,” the brief states. “Under these circumstances, final judgment should not be entered.”

Scarpulla, the newly named Commercial Division judge who is taking over most of Kapnick’s cases following the latter’s elevation to the Appellate Division, First Department this week, set a hearing date of Feb. 19 to consider the motion.