Judge Laurel Myerson, a U.S. bankruptcy justice in Florida, dragged BofA lawyers at Kaye Scholer on to the mat for placing “potentially defamatory facts in the pleading [against a Miami developer] without investigating them fully,” according to the Wall Street Journal.Kaye Scholer attorneys claimed that Cabi Downtown rented at least nine condos in the Everglades on the Bay condiminium to convicted felons. Cabi claimed that two tenants had criminal records, but pose “no basis for any concern.”
WSJ: “If you truly believed there were dangerous individuals living in that building,” the judge wrote of the Kaye Scholer claims, “then that is something you should have brought to the debtor’s attention immediately, unless it’s more important to score a litigation point than it is to protect the safety of the people living in your collateral.”
As punishment, the firm will have to pay Cabi Downtown’s legal fees.
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