Insurer MBIA (MBI 0.64%) fell as much as 11% in after-hours trading Monday when the news that it lost a pretrial judgement in its fight against Bank of America (BAC) reached investors. The continued battle stems from allegations that B of A's acquired Countrywide division misrepresented loans to MBIA, which resulted in losses.
If MBIA wins the case, Bank of America would be responsible for buying back the loans -- which would be costly. In the video below, Motley Fool contributor Jessica Alling discusses the most recent determination, how it might be a good sign for Bank of America, and what investors should do next.
