Merrill Lynch to pay $164 million in dot-com research settlement

[JURIST] Merrill Lynch [corporate website] said Friday it will pay $164 million to settle 23 class action lawsuits involving Merrill Lynch's research of internet companies in the 1990s. Merrill Lynch filed a report with the US Securities and Exchange Commission [official website] on Friday, informing them of the settlement plan and stating that the courts must still approve it. As a result of the settlement, plaintiffs in 11 of the 23 cases dropped appeals from previous cases where motions to dismiss were granted. Merrill Lynch will amend its fourth-quarter results to include the cost of the settlement, thereby reducing fourth-quarter earnings by 10 cents per share and full-year 2005 earnings by 11 cents per share.

Two lawsuits were originally dismissed [internet.com report] in 2003 because the court did not want to condone speculative investors who hoped to re-coup their losses from the volatile dot-com era. The US Second Circuit Court of Appeals reinstated the lawsuits [JURIST report] in 2005 and Merrill Lynch still plans to defend those suits “vigorously.” CBC News has more.



 

About Paper Chase

Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

© Copyright JURIST Legal News and Research Services, Inc., 2013.