Appellate Court Affirms Dismissal of Shareholder Derivative Suit Against Simpson Thacher Client Morgan Stanley
03.27.12
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On March 22, 2012, the New York Appellate Division, First Department affirmed the dismissal of a shareholder derivative suit challenging the total compensation payments Morgan Stanley made to all of its employees world-wide in 2006, 2007 and 2009. The action alleged that the Board committed corporate waste and breached the duty of loyalty by allegedly approving the compensation payments, and that certain executive officers were unjustly enriched by them. The firm had won dismissal in the Commercial Division of New York Supreme Court in December 2010 on the ground that the shareholders had failed to make a pre-suit demand on the Board and demand was not futile.
The Simpson Thacher team included Bruce Angiolillo, Jon Youngwood, Shannon Torres and Erik Risendal.