Judge Jed S. Rakoff is at it again. In his latest salvo in Bank of America's civil trial with the SEC over the Merrill Lynch bonus scandal, Judge Rakoff blasted the bank's attempts to use news reports as evidence at trial.
To recap, the SEC is suing Bank of America for misleading investors about its intentions to pay out year-end bonuses to Merrill Lynch employees. While it was buying Merrill, the bank maintained in its regulatory filings that no bonuses would go to Merrill workers.
At issue in the most recent court proceedings is whether or not media reports of the bonuses could be used as evidence. According to this ruling, Bank of America is apparently arguing that, because several prominent media outlets reported that Merrill bonuses would be doled out, the bank was absolved of, um, having to tell the truth.
From Rakoff's ruling:
"In effect, the bank is arguing that, even though it expressly warned its shareholders to disregard the media, it can now defend itself by asserting that a reasonable shareholder would have disregard these warnings and, by consulting the media, perceived that the bank's alleged lies were immaterial. Even a zealous advocate might perceive that such an argument hints at hypocrisy. "
When he's not in full-blown acerbic mode, Rakoff apparently enjoys cutting a rug. At the Business Insider, Erin Geiger Smith passes along this video. (Rakoff appears at the 1:50 mark.)