Investors involved in the $8.5 billion bond settlement with Bank of America Corp. are looking for the case to be moved back to state court, according to a Bloomberg report.
The U.S. Court of Appeals in New York agreed this week to review the ruling that moved consideration of BofA's settlement over mortgage debt to the federal court, rather than sending it back to the New York State Supreme Court.
Bank of New York Mellon Corp. negotiated the deal that includes BlackRock and Pacific Investment Management Co. or Pimco. This would apply to 530 MBS trusts, the report said.
Other investors, who were not part of the negotiation proceedings, will have also been bound by the outcome and considered the $8.5 billion payout too low.
According to the Bloomberg report, by moving the case to the federal court, these investors could back out, or negotiate higher payouts.