MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Wednesday, July 16, 2003 Federal Judge Grants Class Action Against Morgan Stanley This hasn't been a good month for at Morgan Stanley. Just two days after state regulators held a press conference to say that they are investigating how the brokerage sells funds, it finds itself facing a class action lawsuit. This time, though, the issue is not whether Morgan Stanley disclosed how it compensated brokers. Instead the question is whether the brokerage properly calculated the net asset value of a fund. Lawrence Nicholson, a shareholder in the Morgan Stanley Dean Witter Prime Income Trust, filed the case in Manhattan Federal Court. He claims that he overpaid for shares in the fund after Morgan Stanley incorrectly valued loans that it held. The alleged incorrect valuation of the loans led to the trust's net asset value being inflated and investors overpaying for their shares, he claims. Nicholson's case took a step forward today when U.S. District Judge Harold Baer granted it class action status. Baer ruled that the class could consist of anyone who acquired shares in Prime Income Trust over a period of two and a half year period stretching from November 1, 1998 to April 26, 2001. The judge also appointed two Law firms -- Goodkind Labaton Rudoff & Sucharow and Cauley Geller Bowman Coates & Rudman -- as lead counsel for the case. Morgan Stanley lawyers had argued that that Nicholson does not meet the standard of a typical representative and does not have incentive to represent adequately all members of the class, according to Reuters. Printed from: MFWire.com/story.asp?s=5509 Copyright 2003, InvestmentWires, Inc. All Rights Reserved |