Judge: Countrywide shareholders' suit can proceed

Countrywide asked the court to dismiss the case, in part on the grounds that the pension funds did not have legal standing because they had not shown they consistently held stock in the company.

The lender, which in January agreed to sell itself to Charlotte, N.C.-based Bank of America Corp. for about $4 billion in stock, has been the target of shareholder and consumer lawsuits since last summer's housing crash.

The company has since struggled to stay afloat as loan defaults pile up and the housing slump drags on.

Countrywide shareholders have seen the value of the company's stock plunge by more than 80 percent from its five-year peak of $45.03 in February 2007.

Countrywide shares fell 13 cents, or about 2.6 percent, to $4.85 Wednesday.