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Lawyers for Banc of America Securities LLC presented e-mail evidence in a New York federal court Friday that they say shows that Kasowitz, Benson, Torres & Friedman knowingly used privileged documents in order to bring a case against several hedge funds on behalf of Biovail Pharmaceuticals, a drugmaker. Gary Svirsky, a partner at O’Melveny & Myers who represents B of A, asked Judge Richard Owen to disqualify Kasowitz, Benson as counsel in the case. Svirsky also asked the judge to order Kasowitz, Benson to pay B of A’s attorneys’ fees. Biovail is the defendant in a shareholder lawsuit in New York and the plaintiff in a New Jersey lawsuit against several hedge funds and analysts who cover the pharmaceutical industry. Some of the analysts are employed by B of A. At issue in both suits is whether the hedge funds and analysts colluded in a scheme to bring Biovail’s stock price down and short its stock. In an earlier hearing, name partner Marc Kasowitz testified that he didn’t know the documents were sealed until January 2007. The e-mails presented by B of A on Friday show that a Kasowitz attorney asked for — and received — a copy of the protective order on March 7, 2006, two days before Biovail served the complaint against the hedge defendants. “Far from taking measures to comply with the protective order,” Svirsky of O’Melveny wrote in a letter to the court yesterday, “the Kasowitz firm appears to have been working aggressively to violate it.” B of A is not a party to either suit. Banc of America Securities, the investment banking arm of Bank of America Corporation, provided documents to Biovail in the shareholder derivative suit, on the condition that the documents would not be used in any other litigation. Kasowitz declined to comment. In Friday’s proceedings, however, John Siffert of Lankler Siffert & Wohl, an attorney for Kasowitz, said the incident was a simple misunderstanding. He said that the protective order had been communicated to one junior associate at the firm, who didn’t alert his superiors. “To suggest willful disregard for the judge’s order is wrong,” he said. The use of the documents has been the subject of a long-running dispute. B of A complained to New York judge Richard Owen about the breach of the protective order as early as last summer. In a previous hearing, Judge Owen ordered that the privileged material be culled form the hedge fund complaint, and ordered Biovail to pay B of A’s attorneys’ fees. The hearing is scheduled to continue Tuesday.

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