Federal Court Rules That Black Brokers at Merrill Lynch May File Class-Action Suit

Black brokers stand to gain millions if they are successful in their class-action suit against a division of the Bank of America.

Posted: 02/24/2012 06:33 PM EST
Merrill Lynch Black brokers

A federal court in Chicago has ruled that African-American brokers who have accused Merrill Lynch of bias can pursue a class action suit, a decision that reverses an earlier ruling by a lower court.

The lawsuit accused the brokerage company, which is a division of Bank of America, of steering African-American employees into clerical positions and giving the lucrative accounts to white brokers. The suit also accuses Merrill Lynch of creating a hostile work environment for Black workers.

The decision by the 7th U.S. Circuit Court of Appeals in Chicago was notable because it comes less than a year after a decision by the United States Supreme Court that involved workers at Wal-Mart stores. The court ruling in that case made it more difficult for workers to pursue class-action suits.

If the plaintiffs are ultimately successful, it could lead to millions of dollars landing in the hands of hundreds of African-American workers.

In the decision by the three-judge panel of the 7th Circuit, Judge Richard Posner said that "we have trouble seeing the downside" of letting roughly 700 current and former brokers collectively sue Merrill for charges of discrimination.

"There is no indication that the corporate level of Merrill Lynch (or its parent, Bank of America) wants to discriminate against Black brokers. Probably it just wants to maximize profits," Judge Posner wrote. "But in a disparate impact case the presence or absence of discriminatory intent is irrelevant."

Shirley Norton, a spokeswoman for the company, said that Bank of America strongly disagreed with the court. She said that the company has “progressive workplace practices,” and that it also considered diversity to be part of the bank’s corporate priority.

In last year’s Wal-Mart case a divided Supreme Court dismissed a class-action lawsuit on behalf of as many as 1.5 million female workers who claimed the company offered them lower pay and fewer promotions than men.

The court said that the proposed class-action suit raised too many different claims, often based on decisions at the local store level.

BET National News - Keep up-to-date with breaking news stories from around the nation, including headlines from the hip hop and entertainment world.

Videos You May Like