Court Upholds Bid to Sue Merrill Lynch

A California appeals court Wednesday upheld a decision to reinstate a lawsuit brought against Merrill Lynch by 14 government entities who claim they lost $80 million as a result of the firm’s involvement in the 1994 Orange County bankruptcy.

California’s 1st Appellate District Court upheld a decision it issued last month. That ruling overturned a lower court ruling that said the 14 local governments and agencies had no grounds to sue Merrill Lynch as a third party.

The agencies are the cities of Buena Park, Yorba Linda, Atascadero, Claremont, Milpitas, Montebello, Mountain View and Santa Barbara; the Santiago and Yorba Linda water districts; and the Buena Park, Yorba Linda, Santa Barbara and Montebello redevelopment agencies.