This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Bank of America Ordered to Unseal Documents in MBIA Case

Stocks in this article: MBI BAC

NEW YORK ( TheStreet) -- Bank of America (BAC)has been ordered to unseal by January 8 certain documents it had sought to keep under wraps in a legal dispute with insurer MBIA (MBI), according to a decision Thursday by New York State Supreme Court Judge Eileen Bransten.

MBIA is suing Bank of America over mortgages placed into bonds it sold by Countrywide in the years leading up to the subprime mortgage crisis. MBIA insured the bonds, but wants Bank of America to assume liability for them because MBIA claims they contain false representations. Many analysts expect Bank of America to eventually settle the case for $2 billion to $3 billion, but the bank has been stalling, trying to run out the clock on cash-strapped MBIA.

The more than three year old case has provided countless pages of documents, including financial records, internal company emails, and testimony from senior Bank of America and Countrywide executives, including Bank of America CEO Brian Moynihan and former Countrywide CEO Angelo Mozilo. One massive trove of documents released Nov. 19 and 20 added up to more than 16,5000 pages, according to BTIG analyst Mark Palmer.

The documents at issue in Thursday's decision by Judge Bransten fall into 11 different categories, covering everything from witnesses' home addresses to Countrywide's current financial information, to capital contributions from Bank of America to Countrywide to non-public information concerning the amount of Countrywide's litigation costs and reserves. Bloomberg L.P. has joined MBIA in opposing Bank of America's motion to keep the documents out of public view.

Judge Bransten granted many of Bank of America's requests to keep documents under seal, but MBIA shares still gained 11.67% Friday. BTIG's Palmer, who is bullish on MBIA shares, sees the Judge's order as a positive for the bond insurer.

"We have said for some time that a settlement in the MBIA-Bank of America legal battle likely would not occur until BofA reaches the point at which it is experiencing real pain by not settling. The decision by Justice Bransten to unseal certain documents that BofA would prefer to remain private - including information about the structure of a prior BofA settlement, as well as details about the process through which it funneled capital to Countrywide - moves the bank a couple of steps closer to its pain threshold, in our view," Palmer wrote via email.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs