Bank of America Corp (BAC)’s Surprising Revelation

To bring it full circle, in turn, this is the reason that Bank of America claims to have been so careful about the way in which it commingled the two operation’s assets. As a spokesman for the bank noted previously to Bloomberg News, it “took great pains to preserve the separate identity of Countrywide.”

These purported pains aside, the opposing parties argue that Bank of America Corp (NYSE:BAC) should nevertheless be on the hook for Countrywide’s liabilities. Their position is based on a number of exceptions to the doctrine of successor liability. And while I won’t get into them at this point, at least one of the arguments had made significant headway in a parallel case between Bank of America and mortgage-bond insurer MBIA Inc. (NYSE:MBI) before the parties settled the dispute last month. Suffice it to say, had these arguments succeeded, the issue of Countrywide’s bankruptcy would have been rendered irrelevant. But as I write today, it’s still one of the most powerful cards that Bank of America has at its disposal.

The article Bank of America’s Surprising Revelation originally appeared on Fool.com and is written by John Maxfield.

John Maxfield owns shares of Bank of America. The Motley Fool recommends American International Group (NYSE:AIG) and BlackRock. The Motley Fool owns shares of American International Group and Bank of America and has the following options: Long Jan 2014 $25 Calls on American International Group.

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