In a February 26, 2026 Opinion and Order, Judge Valerie Caproni of the United States District Court for the Southern District of New York granted Plaintiff’s class certification motion in Valelly v. Merrill Lynch, Pierce, Fenner & Smith Inc., Case No. 1:19-cv-07998-VEC (S.D.N.Y.). The Court certified a class of persons who had Merrill Edge retirement accounts with cash balances swept pursuant to Merrill’s Retirement Asset Savings Program (“RASP”) between December 15, 2016 through March 15, 2020 and appointed Wolf Popper as class counsel.
The action alleges that Merrill breached its contractual obligation to pay a “reasonable” rate of interest on cash held in RASP, which is Merrill’s sweep feature for online retirement brokerage accounts. During the class period, Merrill defaulted customers into low yielding sweep accounts at its affiliate, Bank of America, N.A., which paid an approximate 0.14% yield on cash balances, far below the federal funds rate, which exceeded 2.40%, and the rates of similar products.
In granting class certification, Judge Caproni found that class members’ contracts contained the same terms and that their claims would be “resolved using the same form of proof,” specifically evidence showing that Merrill’s rates were “not reasonable.” Judge Caproni observed that Plaintiff “has already presented an expert who will testify about precisely that, and the Court has already ruled that her testimony is admissible.” The Court also held that Merrill “cannot defend this case by arguing that class members have only themselves to blame because they could have earned a higher interest rate had they used a different brokerage firm for their retirement account.”
In appointing Wolf Popper as class counsel, the Court found, among other things, that the firm has “substantial experience litigating complex class actions” and has “doggedly prosecuted this case for many years,” which “has already proceeded efficiently through summary judgment.”