The plaintiffs lawyers James Sturdevant and Thomas Brandi, who may be out huge legal fees, promised to appeal to the state supreme court. The case revolves around Bank of America’s ability to charge over-draft fees on accounts that were set up to receive social security payments.
The trial was presided over by San Francisco Superior Court Judge Anne Bouliane. The unanimous 14 page ruling was written by Justice Peter Siggins. The court did make the comment that the problem was complex and more suited to legislative solutions than judicial actions. Therefore they were overturning the trial courts ruling.
While this is good news at Bank of America, the market hardly blinked. Mainly because most investors cannot follow the complexity of legal argumentation and therefore they dismiss it. This time it probably will not bite them. The potential settlement was huge. With $284 million in compensatory damages and a correspondingly gargantuan legal fee, the total bill to Bank of America would have been just over $2 Billion (About half of a quarters profits). Next time who knows? Most investors have a blind spot and usually dismiss these problems all too easily.
BAC 1-yr chart: