Let’s hope the plaintiffs lawyers in the Bank of America securities class action suit have some big wheelbarrows, or at least terabytes of computer hard drive space. On Tuesday, in a huge win for shareholders, Manhattan federal district court Judge Denny Chin took the unusual step of lifting the statutory discovery stay in the securities fraud case. His order will give the plaintiffs access to the mountains of documents that BofA and related defendants have already turned over to Congress, the Securities and Exchange Commission, the New York attorney general and other government entities scrutinizing BofA’s acquisition of Merrill Lynch. In addition, lawyers for the shareholders will be able to use transcripts of depositions taken by other investigators.
They will also probably get access to communications between BofA and its lawyers that the bank turned over to various government agencies after it waived the attorney-client privilege in October. Chin’s ruling does not carve out an exception for privileged materials. The protective order issued by Manhattan federal district court Judge Jed Rakoff in the SEC’s case against Bank of America states that BofA is not deemed to be waiving its privilege “regarding other information that may be of interest in related private lawsuits.” That language can be construed to mean that BofA can still claim privilege over materials government investigators didn’t ask for — not necessarily that plaintiffs in private lawsuits can’t have access to the documents the bank did turn over.
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