[ by Melanie Gretchen ] Bank of America directors will have to defend in New York federal court a proposed settlement of the claims by shareholders for allegedly paying too much for Merrill Lynch in 2008, court papers show.  Lawyers in a similar Delaware caes called the settlement of $20 million "grossly inadequate," for the effect it may have on their later trial this October. Lawyers in a similar Delaware case have asked P. Kevin Castel, the judge overseeing the New York matter, to order the parties agreeing to the deal to justify its terms.  To this end, Judge Castel directed that parties submit necessary documents by May 4. In the Delaware matter, damages in the case could reach $5 billion, according to the plaintiffs in the case being handled in Delaware Chancery Court, the New York Times reported.  Lawyers in the Delaware case said that if the settlement in New York were approved, their clients' damages claims would be wiped out. The BofA Settlement... was struck on April 12 by lawyers representing 2 public employee pension funds that had sued the directors of Bank of America for breach of fiduciary duty.  The funds are the Louisiana Municipal Police Employees' Retirement System and the Hollywood Police Officers' Retirement System in Florida. For his part, Judge Jed Rakoff, Judge Castel's colleague, approved a $150 million settlement by the bank of SEC civil charges over the Merrill takeover, after earlier rejecting a $33 million accord as inadequate. Castel's colleague in New York, Judge Jed Rakoff, grudgingly approved a $150 million settlement by the bank of U.S. Securities and Exchange Commission civil charges over the Merrill takeover, after earlier rejecting a $33 million accord as inadequate. For further details, go to [Reuters, 4/23/12].