Bank of America 2005 Annual Report Download - page 168

BANK OF AMERICA CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements—(Continued)
several related entities in North Carolina state court for Mecklenburg County, entitled Parmalat Capital Finance
Limited v. Bank of America Corp., et al. (the PCFL Action). PCFL is a Cayman Islands corporation that is in liquidation
proceedings in Grand Cayman. The PCFL Action alleges that the Corporation and other defendants conspired with
Parmalat insiders to loot and divert monies from PCFL, and it asserts claims for breach of fiduciary duty, aiding and
abetting breach of fiduciary duty and other related claims. PCFL asserts that it lost hundreds of millions of dollars as a
direct result of the Corporation’s activities. The Corporation has filed a notice of removal to the U.S. District Court for
the Western District of North Carolina. The PCFL Action has been transferred to the U.S. District Court for the
Southern District of New York for coordinated pre-trial purposes with the other Parmalat-related proceedings.
On December 15, 2005, certain purchasers of Parmalat-related private placement offerings filed first amended
petitions against the Corporation and various related entities in state courts in Iowa, entitled Principal Global Investors,
LLC, et al. v. Bank of America Corporation, et al. (Principal Global Investors) and Monumental Life Insurance Company,
et al. v. Bank of America Corporation, et al. (Monumental Life Insurance Company). The actions allege violations of Iowa
state securities law and various state law claims, and seek rescission and unspecified damages based upon the
Corporation’s and related entities’ alleged roles in certain private placement offerings issued by Parmalat-related
companies. On January 4 and 5, 2006, respectively, the Principal Global Investors case was removed to the U.S. District
Court for the Southern District of Iowa, and the Monumental Life Insurance Company case was removed to the U.S.
District Court for the Northern District of Iowa. On February 13, 2006, the Corporation filed its answers to each of these
complaints. On February 15, 2006, these cases were consolidated for pretrial purposes with the In Re Parmalat
Securities Litigation matter.
On January 18, 2006, Gerald K. Smith, in his capacity as Trustee of Farmland Dairies LLC Litigation Trust, filed a
complaint against the Corporation, BANA, BAS, BASL, Bank of America National Trust & Savings Association and
BankAmerica International Limited, as well as other financial institutions and accounting firms, in the U.S. District
Court for the Southern District of New York, entitled Gerald K. Smith, Litigation Trustee v. Bank of America
Corporation, et al. (the “Farmland Action”). Prior to bankruptcy restructuring, Farmland Dairies LLC was a wholly-
owned subsidiary of Parmalat USA Corporation, which was a wholly-owned subsidiary of Parmalat SpA. The Farmland
Action asserts claims of aiding and abetting, breach of fiduciary duty, civil conspiracy and related claims against the
Bank of America defendants and other defendants. The plaintiff seeks unspecified damages. On February 23, 2006, the
plaintiff filed its first amended complaint.
Pension Plan Matters
The Corporation is a defendant in a putative class action entitled William L. Pender, et al. v. Bank of America
Corporation, et al. (formerly captioned Anita Pothier, et al. v. Bank of America Corporation, et al.), which was initially
filed June 2004 in the U.S. District Court for the Southern District of Illinois and subsequently transferred to the U.S.
District Court for the Western District of North Carolina. The action is brought on behalf of participants in or
beneficiaries of The Bank of America Pension Plan (formerly known as the NationsBank Cash Balance Plan) and The
Bank of America 401(k) Plan (formerly known as the NationsBank 401(k) Plan). The Third Amended Complaint names
as defendants the Corporation, BANA, The Bank of America Pension Plan, The Bank of America 401(k) Plan, the Bank
of America Corporation Corporate Benefits Committee and various members thereof, and PricewaterhouseCoopers LLP.
The two named plaintiffs are alleged to be a current and a former participant in The Bank of America Pension Plan and
401(k) Plan.
The Third Amended Complaint alleges the defendants violated various provisions of ERISA, including that the
design of The Bank of America Pension Plan violated ERISA’s defined benefit pension plan standards and that such
plan’s definition of normal retirement age is invalid. In addition, the complaint alleges age discrimination in the design
and operation of The Bank of America Pension Plan, unlawful lump sum benefit calculation, violation of ERISA’s “anti-
backloading” rule, improper benefit to the Corporation and its predecessor, and various prohibited transactions and
fiduciary breaches. The complaint further alleges that certain voluntary transfers of assets by participants in The Bank
of America 401(k) Plan to The Bank of America Pension Plan violated ERISA.
The complaint alleges that current and former participants in these plans are entitled to greater benefits and seeks
declaratory relief, monetary relief in an unspecified amount, equitable relief, including an order reforming The Bank of
America Pension Plan, attorneys’ fees and interest.
The court has scheduled the case for trial in September 2006. On September 25, 2005, defendants moved to dismiss
the Third Amended Complaint. The motion is pending.
On December 1, 2005, the named plaintiffs moved to certify classes consisting of, among others, (1) all persons who
accrued or who are currently accruing benefits under The Bank of America Pension Plan and (2) all persons who elected
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