Texas Investors Sue Merrill Lynch Over $39M In ARS

Law360, New York (January 26, 2009, 12:00 AM EST) -- Investors in Texas have sued Merrill Lynch & Co. Inc. for selling them more than $38.7 million in auction rate securities and refusing to buy them back after the market collapsed in February.

The class action, filed on Friday in the U.S. District Court for the Southern District of Texas, alleges that Merrill Lynch, one of the largest ARS underwriters in the U.S., misled investors when it sold a subset of ARS called auction rate preferred stock to Texas-based firm Amgey Investments Inc., which then sold...
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