Bank of America Corp.'s Merrill Lynch unit won an appeal of aruling dismissing an investor suit over auction-ratesecurities.

A federal appeals court in New York ruled today that MerrillLynch provided the investor, Colin Wilson, with sufficientinformation about its practice of propping up auctions in thesecurities by submitting its own bids, barring his claim thatMerrill misled investors about the securities' liquidity. Wilsonhad appealed a lower court's dismissal of the suit.

“Merrill's particular disclosures sufficiently alerted investorsin Merrill ARS of the likelihood that the interest rates andapparent liquidity of these ARS reflected Merrill's ownintervention in these auctions rather than the natural interplay ofsupply and demand,” U.S. Circuit Judge Robert Katzmann wrote onbehalf of a three-judge panel.