Morgan Stanley has been fined
$12.5 million for not providing emails. The Wall Street journal also notes
that the company was also fined $15 million in 2005 for not providing emails.
It doesn’t note that Morgan Stanley was ordered
to pay Ron Perelman $1.45 billion in 2005, ultimately because it was so
bad at providing emails:
In an unusual ruling in March, the judge hearing the case, Elizabeth T. Maass,
ordered the jury to take as granted that Morgan Stanley and Sunbeam acted
together in the fraud, because of what she called obstructionist behavior
on the part of Morgan Stanley, who she claimed was holding back e-mail evidence.
Interestingly, a large part of Morgan Stanley losing that case (which later
rose to $1.57 billion but which was ultimately overturned
on appeal, although it’s still being litigated) was that the company fired
its lawyers, Kirkland & Ellis, just before the trial began – and
then wouldn’t tell the judge why, leading the judge to refuse a motion giving
the bank’s new lawyers more time to prepare their case.
Something to ponder, next time you wonder whether
you should fire your lawyer. I wonder, what are the odds that by now
Morgan Stanley has finally got its email act in order? It’s weird: when I started
writing about banks and the internet back in 1995, Morgan Stanley was very much
ahead of the curve, both in terms of investment ideas and in terms of its own
IT expenditure. I wonder what happened.