NY Appeals Court Scraps $5.7B CDO Suit V. Merrill

Law360, New York (February 1, 2011, 8:17 PM EST) -- A New York appeals court has tossed the lone remaining claim — for breach of contract — in MBIA Inc.’s suit alleging Merrill Lynch & Co. Inc. misrepresented the quality of $5.7 billion in MBIA-insured collateralized debt obligations.

A panel of the New York Supreme Court, Appellate Division, ruled Tuesday that the breach of contract claim — left standing after an earlier decision gutted the case — failed to state a cause of action because Merrill never guaranteed the credit quality of its securities.

Nothing in...
To view the full article, register now.