It didn't come as a complete surprise to us, but federal district court judge Jed Rakoff's fire-breathing rejection of Bank of America's $33m (£20m) settlement with the Securities and Exchange Commission (SEC) was a stunner. His anger at BoA and the SEC radiated off the page. They didn't tell him what he wanted to know – namely, who was responsible for disclosure decisions about the $5.8bn (£3.5bn) approved for Merrill Lynch bonuses – and he wasn't buying either sides' arguments about why this settlement was reasonable.

For a good recap of Judge Rakoff's order, see Zach Lowe's article at The Am Law Daily.

Even before Judge Rakoff's ruling, BoA's strategy in this SEC case had struck us as odd. In court filings and arguments made by Lewis Liman of Cleary Gottlieb Steen & Hamilton, the bank seemed more intent on arguing that its disclosure was proper than showing that this settlement was reasonable. Its rigid insistence that it did nothing wrong clearly angered the SEC, which is not likely to help as this case moves forward. And that controversial position didn't please Judge Rakoff either. In fact, he cited it as one reason that he couldn't approve the settlement. Since the settlement included an injunction against future disclosure violations by BoA, that injunction was meaningless if BoA didn't believe that its handling of the bonus issue was improper, he wrote.