An appellate court on Monday declined to reconsider its decision to throw out a mortgage-fraud case against Bank of America Corp., a blow to the Justice Department as it tried to rescue one of its highest-profile cases tied to the financial crisis.

Judges for the Second U.S. Circuit Court of Appeals in New York said in a filing they had considered the Justice Department's request and would deny it. The judges didn't elaborate on their decision.

The case centered on a mortgage program known as the "Hustle" at lender Countrywide Financial Corp., which Bank of America bought in 2008. The U.S. attorney's office in Manhattan sued the bank in 2012, and a jury the following year found the bank liable for fraud.

In May, a three-judge panel from the Second Circuit tossed out the verdict and the accompanying $1.27 billion fine, saying that the government hadn't proven that the bank's actions amounted to fraud. Earlier this month, the Justice Department asked that court to reconsider, saying that the court had "overlooked a wealth of evidence."

The government could ask the Supreme Court to consider the case. A spokesman for the Manhattan U.S. attorney's office declined to comment.

Throughout the trial and its appeal, Bank of America denied wrongdoing. A spokesman declined to comment Monday.

Aruna Viswanatha contributed to this article.

Write to Christina Rexrode at christina.rexrode@wsj.com

(END) Dow Jones Newswires

August 22, 2016 16:35 ET (20:35 GMT)

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