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The Dismissal of a Lawyer
Timothy J. Mayopoulos was the general counsel for Bank of America (B of A) until shortly before its merger/acquisition of Merrill Lynch was approved by B of A shareholders. Mr. Mayopoulos was fired from his position on the day he met with the board, and the board was told that Merrill Lynch had heretofore undisclosed losses that had not been disclosed to B of A shareholders. He was escorted out of the Charlotte, North Carolina, B of A headquarters by security personnel and was not permitted to return to his office and collect his belongings. The merger was approved, and the shareholders brought suit for the bank's failure to disclose the full scope of the Merrill Lynch losses.
Mr. Mayopoulos gave testimony to New York Attorney General Andrew Cuomo, the official who had been investigating whether information about the scope of the losses was withheld prior to the shareholder vote on the Merrill Lynch merger/acquisition.Mr. Mayopoulos, however, declined to disclose to Mr. Cuomo's office the content of the advice he gave to the bank, citing legal ethics rules.
Mr. Cuomo asked B of A to waive "the privilege" because its refusal was hindering his office's ability to investigate what happened in the days leading up to the merger/acquisition.
B of A initially refused to waive its attorney-client privilege. However, when an SEC investigation began, the bank waived the privilege and then settled the SEC case for a $150 million fine. The shareholder litigation was settled for $2.43 billion. B of A's then CEO, Kenneth D. Lewis, testified that Mr. Mayopoulos was fired because B of A had more executives than it needed following the merger.
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