Court upholds Woori suit dismissal

A U.S. appeals court on Thursday upheld the dismissal of a lawsuit brought by Korea’s Woori Bank against the Merrill Lynch unit of Bank of America Corp. dealing with losses from $143 million in mortgage-related investments.

The 2nd U.S. Circuit Court of Appeals in New York said Woori’s 2012 lawsuit was not filed until after the the expiration of the three-year statute of limitations under Korean law.

Woori, which is owned by Woori Finance Holdings, had argued that the three-year clock did not start until January 2011, when the U.S. Financial Crisis Inquiry Commission published a report outlining the primary causes of the U.S. housing market meltdown.

But the appeals court decided that government investigations into Merrill Lynch, lawsuits filed against Merrill Lynch over the collateralized debt obligations in question and “overall publicity” surrounding the investments were enough to show that Woori should have been aware of its potential claims against Merrill Lynch more than three years before it filed its lawsuit.

A U.S. lawyer for Woori did not immediately return a request for comment on Thursday.

The dismissal, initially made by U.S. District Judge Victor Marrero in February, is one of three such defeats in a United States court for Woori Bank, which was put under state control following financial crises.

In March, U.S. District Judge Laura Taylor Swain dismissed a Woori lawsuit against Citigroup, saying Woori had failed to show that Citigroup acted fraudulently in selling it $95 million in CDOs.

Swain permitted the bank to file an amended complaint, which it did in August.

And in December, another Manhattan federal judge dismissed Woori’s lawsuit against the Royal Bank of Scotland Group over losses on $80 million of debt securities.

Woori has appealed that decision to the 2nd Circuit.

Reuters