The New York state judge who on Tuesday issued a temporary restraining order prohibiting a Morgan Stanley executive from "directly or indirectly" hiring Merrill Lynch employees appears to have softened her stance.

State Supreme Court Justice Emily Jane Goodman on Thursday granted Morgan's request to amend a substantial aspect of the order, according to Reuters.

Goodman ruled that James Gorman, a former president of Merrill's global private client group who now heads Morgan's brokerage unit, may give his comments on job candidates and take part in activities related to their hiring if those candidates were identified independently. Gorman is still barred from contacting applicants directly or indirectly.

Morgan applauded the modification, saying Gorman "has honored and continues to honor his obligations with Merrill Lynch. We are surprised and disappointed that Merrill felt it necessary to go to court to try to slow the number of people who have reached out to Morgan Stanley."

In Merrill's opinion, however, the judge merely made minor changes to the order. Morgan, it said, "moved to strike a substantive provision of the original order. The judge refused to grant that request and instead made a minor modification to the order."

The two firms will appear in court on March 30 to argue whether the temporary restraining order should be lifted or extended.  

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