A North Carolina federal judge has approved a $12.8 million settlement to resolve a proposed class action accusing Merrill Lynch of shortchanging financial advisers on deferred compensation following Bank of America Corp.’s 2008 acquisition of the brokerage. U.S. District Judge Robert J. Conrad Jr. granted final approval of the settlement, which resolves claims brought by former Merrill Lynch financial advisers Benjamin E. Davis and Roberto F. Garcia, who asserted they were involuntarily terminated and denied bonuses earned through various compensation plans, including a plan designed to retain Merrill Lynch employees following the merger. The judge wrote in an 11-page order:
This court hereby approves the settlement set forth in the stipulation and finds that the settlement is, in all respects, fair, reasonable and adequate to the settling parties.
For purposes of the settlement, Judge Conrad certified a class of more than 270 Merrill Lynch financial advisers who were employed by the company in September 2008 and involuntarily terminated from employment from January 2009 and March 2016, and have unvested awards in one of four compensation plans. Also included in the class are current Merrill Lynch advisers who were employed as of March 23 with unvested awards in the plans. The judge approved attorneys’ fees of approximately $3.2 million, or 25 percent of the settlement amount, costs of about $124,000 and service awards of $20,000 each to Davis and Garcia for their roles as class representatives.
The suit was filed in April 2015 and alleges Merrill Lynch failed to follow the contractual requirements of the plans following involuntary termination, which made the terminations not for “cause,” and therefore the advisers were entitled to their bonuses. Judge Conrad granted preliminary approval of the settlement in March. The class is represented by Michael S. Taaffe, Michael D. Bressan, Jarrod J. Malone, Steven A. Meckler and David L. Wyant Jr. of Shumaker Loop & Kendrick LLP. The case is Benjamin E. Davis et al. v. Merrill Lynch & Co. Inc. et al. in the U.S. District Court for the Western District of North Carolina.
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