Bank of America 2008 Annual Report Download - page 163

included in the Italian extraordinary administration proceeding. In July
2004, the Italian Ministry of Production Activities approved the Extra-
ordinary Commissioner’s restructuring plan, as amended, for the Parma-
lat group companies that are included in the Italian extraordinary
administration proceeding. This plan was approved by the voting creditors
and the Court of Parma, Italy in October of 2005.
Litigation and investigations relating to Parmalat are pending in both
Italy and the United States.
Proceedings in Italy
On May 26, 2004, The Public Prosecutor’s Office for the Court of Milan,
Italy filed criminal charges against Luca Sala, Luis Moncada, and Antonio
Luzi, three former employees of the Corporation, alleging the crime of
market manipulation in connection with a press release issued by Parma-
lat. On December 18, 2008 the Court of Milan, Italy fully acquitted each
of the former employees of all charges. At this time, the acquittal has not
been appealed. The Public Prosecutor’s Office also filed a related charge
in May, 2004 against the Corporation asserting administrative liability
based on an alleged failure to maintain an organizational model sufficient
to prevent the alleged criminal activities of its former employees. The trial
on this administrative charge is ongoing, with hearing dates scheduled in
2009.
Separately, on October 9, 2008 the Public Prosecutor of the Court of
Parma, Italy filed a notice of intent to file criminal charges against twelve
former and current employees of the Corporation in connection with the
insolvency of Parmalat S.p.A. The notice of intent to file charges alleges
that the Corporation’s transactions with Parmalat contributed to the
insolvency of Parmalat, that certain transactions violated the Italian usury
laws, and that certain former employees of the Corporation wrongly
diverted funds in connection with certain transactions.
Proceedings in the United States
On March 5, 2004, a First Amended Complaint was filed in a securities
action pending in the U.S. District Court for the Southern District of New
York entitled Southern Alaska Carpenters Pension Fund et al. v. Bonlat
Financing Corporation et al. The action was brought as a putative class
action on behalf of purchasers of Parmalat securities, alleged violations
of the federal securities laws against the Corporation and certain affili-
ates, and sought unspecified damages. The action was subsequently
consolidated as the In re Parmalat Securities Litigation before Judge
Lewis A. Kaplan of the Southern District of New York. On August 12,
2008, the District Court dismissed the putative class claims against the
Corporation and its affiliates in their entirety and no appeal was taken.
On October 7, 2004, Enrico Bondi filed an action in the U.S. District
Court for the Western District of North Carolina on behalf of Parmalat and
its shareholders and creditors against the Corporation and various related
entities, entitled Dr. Enrico Bondi, Extraordinary Commissioner of Parma-
lat Finanziaria, S.p.A., et al. v. Bank of America Corporation, et al (the
Bondi Action). The complaint alleged federal and state RICO claims and
various state law claims, including fraud. The complaint seeks damages
in excess of $10 billion. The Bondi Action was transferred to the U.S.
District Court for the Southern District of New York for coordinated
pre-trial purposes with putative class actions and other related cases
against non-Bank of America defendants under the caption In re Parmalat
Securities Litigation. Following orders on motions to dismiss, the remain-
ing claims are federal and state RICO claims, a breach of fiduciary duty
claim, and other state law claims with respect to three transactions
entered into between the Corporation and Parmalat. The Corporation filed
an answer and counterclaims seeking damages. The District Court
granted in part a motion to dismiss certain of the counterclaims, leaving
intact the counterclaims for fraud, negligent misrepresentation and civil
conspiracy against Parmalat S.p.A., Parmalat Finanziaria S.p.A. and
Parmalat Netherlands, B.V., as well as a claim for securities fraud against
Parmalat S.p.A. and Parmalat Finanziaria S.p.A.
Certain purchasers of Parmalat-related private placement offerings
have filed complaints against the Corporation and various related entities
in the following actions: Principal Global Investors, LLC, et al. v. Bank of
America Corporation, et al. in the U.S. District Court for the Southern
District of Iowa; Monumental Life Insurance Company, et al. v. Bank of
America Corporation, et al. in the U.S. District Court for the Northern Dis-
trict of Iowa; Prudential Insurance Company of America and Hartford Life
Insurance Company v. Bank of America Corporation, et al. in the U.S.
District Court for the Northern District of Illinois; Allstate Life Insurance
Company v. Bank of America Corporation, et al. in the U.S. District Court
for the Northern District of Illinois; Hartford Life Insurance v. Bank of
America Corporation, et al. in the U.S. District Court for the Southern
District of New York; and John Hancock Life Insurance Company, et al. v.
Bank of America Corporation et al. in the U.S. District Court for the Dis-
trict of Massachusetts. The actions variously allege violations of federal
and state securities law and state common law, 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. All cases have been transferred to the U.S. District
Court for the Southern District of New York for coordinated pre-trial pur-
poses with the In re Parmalat Securities Litigation matter. The plaintiffs
seek rescission and unspecified damages resulting from alleged pur-
chases of approximately $305 million in private placement instruments.
Pender
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 is pend-
ing in 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 Corporation, BANA, The Bank of Amer-
ica Pension Plan, The Bank of America 401(k) Plan, the Bank of America
Corporation Corporate Benefits Committee and various members thereof,
and PricewaterhouseCoopers LLP are defendants. The complaint alleges
violations 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 by The Bank of America
Pension Plan, unlawful lump sum benefit calculation, violation of ERISA’s
“anti-backloading” rule, 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, and other related claims. The complaint
alleges that plan participants 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. On December 1, 2005, the plaintiffs moved
to certify classes consisting of, among others, (i) all persons who accrued
or who are currently accruing benefits under The Bank of America Pension
Plan and (ii) all persons who elected to have amounts representing their
account balances under The Bank of America 401(k) Plan transferred to
The Bank of America Pension Plan. That motion, and a motion to dismiss
the complaint, are pending.
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