A derivative lawsuit is one that can be filed by shareholders in San Diego, California or any other state across the nation on behalf of a corporation. A corporation may be an entity, but it is not a person or party that can file a lawsuit. It can be brought against a third party when management has failed to do so. In many cases, the third party may be an executive officer or director.

Bank of America has been a major name in the news in a number of settlements, the most recent of which may be the derivative lawsuit filed by investors of the company. The shareholder derivative suit was filed over the acquisition of the company Merrill Lynch & Co. Investors argued that directors were not completely honest about the losses that the newly acquired company had to their name — something that any investor would say matters in a decision to acquire a company.

Investors argued that directors were not completely honest about the losses that the newly acquired company had to their name — something that any investor would say matters in a decision to acquire a company.

A settlement was reached between the parties for $62.5 million. After the settlement was reached, the plaintiffs in the lawsuit filed requests for several millions in order to cover the costs of conducting the litigation. The judge presiding over the case awarded a total of $16.5 million to cover the costs expended during the litigation. Specifically, the money was to cover attorneys fees. Also included was $2.5 million for other associated costs.

Source: News & Insight, “Judge awards fees of $16.5 mln in BofA investor lawsuit,” Nate Raymond, April 5, 2013