Thursday, July 02, 2009

Ohio, Texas state pension funds sue over bailout-related bank mergers

More state or public employee pension funds are practicing their fiduciary responsibility to retirees and going after banks caught up in last year’s collapse.

Five funds, including state employee funds in Ohio and Texas, have sued the Bank of America for misleading them about Merrill Lynch before its “forced marriage” with Merrill on Jan 1

The New York Times ran the Reuters story today on p B4. The story follows a story about action taken by Indiana teachers regarding the Chrysler merger in early June. Pension-related litigation could halt many of the complicated arrangements to help financial companies and auto-related companies avoid or come out of bankruptcy. There is a concern that retirees are being “sacrificed” for current employees, and that the PBGC will not completely cover them.

The updated Reuters story is here.

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