Legal News

Bonusgate Rolls On: A Ruling in Merrill; Cuomo Slams AIG

By Ashby Jones

Cough up the names, Bank of America. Cough ‘em up.

That was the ruling made this afternoon by New York state judge Bernard Fried, who smacked down a bid by B of A to keep details confidential about individuals who received bonuses at Merrill Lynch & Co. on the eve of its merger with B of A last year. Click here for the WSJ story; here for a copy of the ruling; here for an earlier LB post on the situation.

The bank had asked the judge to prevent New York AG Andrew Cuomo from publicly releasing the names of individuals who received bonuses and how much they made.

In his ruling, the judge essentially shot down BofA’s argument that the compensation data was a trade secret. He found that the bank didn’t make efforts to keep compensation data confidential, other than to encourage employees not to discuss pay in the workplace. ”The record indicates that Bank of America has not taken the kind of measures to protect the secrecy of its employee compensation information that one would expect it to have taken if this information were a trade secret,” the judge said.

The insurer has said it will “respond appropriately” to Cuomo’s subpoena.

Okay, now, back to AIG (we couldn’t leave it for too long). Cuomo on Wednesday blasted a move by AIG to have some employees voluntarily give back at least half of a set of controversial bonuses handed out last week.

At a hearing before a House subcommittee on Wednesday, AIG Chief Executive Edward Liddy said the insurer has asked employees who received bonuses of more than $100,000 to return at least half of the money.

Cuomo called the move “too little too late,” adding: “The American people have a right to know what is happening with massive amounts of their money. Mr. Liddy needs to understand this,” Cuomo said. “If AIG is really serious about getting these bonuses back, they should comply with the
subpoena we have issued.”

Full post as published by Law Blog - WSJ.com on March 18, 2009 (boomark / email).