By Cydney Posner

This should be interesting: the NYT is reporting that, under mounting pressure, Bank of America's board has voted to waive attorney-client privilege in the cases involving the Merrill Lynch acquisition.

Reportedly, the tipping point was the threat by Andrew Cuomo, New York's attorney general, to charge individual bank executives, including retiring CEO Kenneth D. Lewis, with wrongdoing. Along with cases involving the SEC and New York, there are also ongoing investigations in a number of other states, focused "on why the bank kept central information about Merrill's bonuses and losses secret from its shareholders, many of whom said they might have voted against the deal before it closed on Jan. 1 if they had known the depth of Merrill's problems. The bank also negotiated a second bailout with the government last December, and it did not disclose those negotiations to shareholders." The article reports that "Wachtell lobbied to keep its advice protected, while other outside lawyers from Cleary Gottlieb Steen & Hamilton as well as Paul, Weiss, Rifkind, Wharton & Garrison urged that the information be turned over, according to two people briefed on the matter. Bank management and the board supported the idea because they had nothing to hide and wanted the bank to move on, according to a person briefed on the board's thinking. A spokesman for Wachtell said the claim that it opposed waiving the attorney-client privilege was 'totally erroneous' and maintained that Wachtell, Cleary, and Paul Weiss gave the same advice at all times. Wachtell remains a legal adviser to the bank but is working on fewer issues."

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