Court OKs class action against Merrill Lynch
Court OKs class action against Merrill Lynch BY MICHAEL P. TREMOGLIE
CHICAGO (Legal Newsline) — African-American brokers employed by Merrill Lynch can pursue racial discrimination claims in a class action.
The United States Court of Appeals for the Seventh Circuit, Chicago, on Feb. 24 reversed a District Court ruling, permitting the class action.
The plaintiffs say there were two companywide policies that are alleged to cause racial bias. One was the authorization of brokers instead of managers to form and staff teams. The other was distributing the established accounts of brokers who left Merrill Lynch on the past success of the brokers who are competing for these accounts. Such accounts are potentially more lucrative because they are established customers who will continue giving business to brokers rather than the brokers needing to locate and persuade a new customer to give them business.
Also, performance appraisals are a factor of team participation and account distribution. This influences the brokers’ pay and promotion.