In 2005, a discrimination lawsuit was filed against Merrill Lynch by an African-American financial advisor in the United States District Court for the Northern District Of Illinois Eastern Division. Eventually, the lawsuit grew into a class action with 1,200 African-American financial advisors as class representatives. The class alleged racial discrimination in violation of 42 U.S.C. Section 1981, Equal Rights. The main claim in the class action discrimination lawsuit was that African-American financial advisors were not provided with the same business opportunities, or the same account distributions, as their white counterparts on investment banking teams. Moreover, the class action representatives alleged that African-American financial advisors were segregated and excluded from the formation of investment banking and adviser teams, which was crucial to developing business strategies. Initially, Judge Robert Gettleman, the District Court Judge in Chicago that was presiding over the matter, rejected the case as a class action three times before a federal appeals court provided class certification. Following the federal appeals court ruling, Judge Gettleman certified the class of “all African-Americans employed by Merrill Lynch at any time since July 10, 2004, as financial advisors or financial advisors trainees” in domestic retail brokerage units of Merrill Lynch’s global private client division. Merrill Lynch has agreed to pay $160 million to settle the discrimination lawsuit. The settlement agreement will be presented to Judge Gettleman on September 3, 2013 for review and approval.
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