On Friday, September 6, 2013, Class Action Plaintiffs filed a motion to approve a settlement agreement with Bank of American/Merrill Lynch regarding gender discrimination claims. Initially, Judy Calibuso, Julie Moss and Dianne Goedtel, on behalf of themselves and all others similarly situated, filed a gender discrimination Class Action Complaint in the United States District Court For The Eastern District Of New York against Bank Of America Corporation (“Bank of America”), Merrill Lynch & Co., Inc., and Merrill Lynch, Pierce, Fenner & Smith, Inc. (collectively “Merrill Lynch”). The Complaint alleged that Bank of America and Merrill Lynch, through various policies and procedures caused “gender-based earnings disparities by intentionally (a) implementing company-wide policies and practices that have allowed and encouraged [Bank of America] and [Merrill Lynch] managers to favor male [financial advisors] over female [financial advisors] in distributing client accounts from departing or retiring [financial advisors]; and (b) implementing company-wide policies and practices that have created a ‘cumulative advantage’ effect by perpetuating and widening the gender-based earnings disparities that Defendants’ discriminatory policies and procedures have caused.” It is reported that the settlement, which requires approval from the District Court Judge, would cover approximately 4,800 women who worked at Bank of America/Merrill Lynch from August 2, 2007 through September 15, 2013. Additionally, the settlement will not only distribute a reported $39 million in cash to the female employees, but will also require Bank of America/Merrill Lynch to change various firm policies. Bill Halldin, a Merrill Lynch spokesperson, made the following statement to the media, “[t]he resolution includes a number of additional and enhanced initiatives that will enrich our existing diversity, inclusion and development programs, providing even more opportunities for women to succeed as financial advisors.”
This is the second discrimination case involving Bank of America/Merrill Lynch this summer. Earlier this summer, our blog discussed a $160 million settlement by Merrill Lynch in a discrimination lawsuit filed by one financial advisor who was African-American. Eventually, the lawsuit grew into a class action, with 1,200 African-American financial advisors as class representatives, alleging racial discrimination in violation of 42 U.S.C. Section 1981, Equal Rights. The main claim in the class action discrimination lawsuit was that African-American financial advisors were not provided with the same business opportunities, or the same account distributions, as their white counterparts on investment banking teams. Moreover, the class action representatives alleged that black financial advisors were segregated and excluded from the formation of investment banking and advisor teams, which was crucial to developing business strategies.
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