This Morgan Stanley settlement is the coda to one of the more interesting and contentious business litigation stories of last year, the feud between Morgan Stanley and billionaire Ron Perelman of Revlon.

The dust up started over allegations of accounting improprieties in the sale of the Perelman-owned Coleman Co. (which makes, among other things these very fine boots owned by The Daily Caveat) to Sunbeam. Perelman alledged in the ensuing litigation that Morgan Stanley played a roll in propping up Sunbeam's numbers in the course of the sale.

Perelman's compensated in the transaction included shares in Sunbeam and according to Perelman's case Morgan Stanley's actions cost him almost $1billion. Morgan Stanley claimed that it was unable to produce certain email communications that Perelman's counsel alledged were relevant to the case. The judge at the time was not amused.

Via Theregister.co.uk

Morgan Stanley offers $15m to make up for missing emails

By OUT-LAW.COM
February 22, 2006

Investment bank Morgan Stanley has offered to pay the Securities and Exchange Commission (SEC) $15m to settle an investigation by the regulator into an alleged failure by the firm to produce email evidence during a legal dispute.

According to an Annual Report filed by Morgan Stanley with the SEC earlier this month, the investment bank has reached "an agreement in principle" with the enforcement division of the SEC, but the settlement has not yet been presented to the full SEC...

...The investigations relate to the 1998 sale of Coleman Co, owned by billionaire Ronald Perelman, to Sunbeam Corp.

Check out the full article here. And for more on the Perelman / Sunbeam conflagration as well as Morgan Stanley's recent woes, check out our past coverage.

-- MDT

Labels: Morgan Stanley