The ruling came before the troubled bank agreed over the weekend to be bought for $2-a- share by JPMorgan Chase & Co and is unrelated to that deal.
New York Court of Appeals said Bear Stearns' insurers are not liable for $45 million worth of settlement costs the firm had sought to have covered. The settlement was reached with various regulators to end a probe into its stock research practices.
Bear Stearns was one of a group of investment banks accused of issuing biased stock ratings that were designed to help the firms win lucrative investment banking business. A wide-ranging settlement was struck between the Wall Street firms and regulators.
The court said in its ruling that Bear had agreed its insurers would not be liable for any settlement of more than $5 million entered into without their consent and that the firm therefore could not force the insurers to pay.
"Bear Stearns therefore may not recover the settlement proceeds from the insurers," said Judge Victoria Graffeo in a written decision.