In re SSA Bonds Antitrust Litigation

Background

The court considered the class plaintiffs’ request for final approval of a settlement with Bank of America Corporation, Bank of America, N.A., Merrill Lynch International, Bank of America Merrill Lynch International Limited, and Merrill Lynch, Pierce, Fenner & Smith Incorporated. The settlement was a partial settlement in a multi-defendant antitrust action involving SSA bond transactions. The opinion does not state the settlement amount.

Settlement Class and Notice

The court certified a settlement class solely for settlement purposes. The class generally covered people and entities that entered into an SSA bond transaction with a defendant, certain related entities, a released party, or an alleged co-conspirator from January 1, 2005, through the date of the preliminary approval order, subject to the geographic and commerce-related requirements stated in the order. The court found that the requirements for class certification under Federal Rule of Civil Procedure 23(a) and 23(b)(3) were satisfied for settlement purposes, including numerosity, common questions, typical claims, adequate representation, predominance, and superiority.

The court also found that mailed and published notice satisfied Rule 23 and due process and was the best notice practicable under the circumstances. It appointed Quinn Emanuel Urquhart & Sullivan, LLP and Robbins Geller Rudman & Dowd LLP as settlement class co-lead counsel and appointed the class plaintiffs as class representatives, solely for settlement purposes.

Approval of the Settlement

Under Rule 23(e), the court granted final approval of the settlement, finding it fair, reasonable, adequate, and in the best interests of the settlement class. The court relied on the record, the parties’ submissions, objections and responses, and the factors identified in Rule 23(e)(2) and applicable precedent. It found that the settlement was negotiated fairly and honestly by experienced counsel through arm’s-length negotiations; that the case presented serious and contested legal and factual issues; that an immediate monetary recovery and cooperation benefits outweighed the possibility of obtaining relief only after further expensive litigation; and that continued litigation might not produce a better result.

The order stated that the settlement and related acts were not admissions or evidence of the validity of the released claims, wrongdoing, liability, fault, or omission by the released parties.

Releases and Claims Preserved

When the settlement became effective, the releasing parties were required to release the released claims against the released parties and were barred from bringing or assisting claims covered by those releases. The settling defendants and other released parties likewise released covered claims against the class plaintiffs, settlement class members, and co-lead counsel. Claims outside the released claims, and claims to enforce the settlement agreement, were not released.

The order barred certain contribution, indemnification, and similar claims by other defendants against released parties to the extent allowed by applicable law. At the same time, the class members’ rights against other current defendants, formerly named defendants, alleged co-conspirators, and other persons later added to the action were preserved. The settling defendant’s SSA bond activity could remain relevant to potential damages claims against those other parties, as permitted by law.

Disposition and Continuing Jurisdiction

Judge Edgardo Ramos granted final approval of the settlement and entered the Final Judgment and Order of Dismissal as to the settling Bank of America and Merrill Lynch entities. The parties were directed to carry out the settlement. The court retained continuing and exclusive jurisdiction over implementation of the settlement, the settlement fund, applications for fees, costs, expenses, and incentive awards, and the parties and released persons for purposes of interpreting, enforcing, and administering the settlement.

The order provided that if the settlement did not become effective, the Final Judgment and Order of Dismissal would become void and the parties would generally return to their prior positions in the litigation. The Clerk was directed to enter the judgment immediately under Rule 54(b).