By Suzanne Barlyn
Jan 7 Morgan Stanley must pay $1 million
to a former manager who alleged he was wrongfully terminated by
the firm, according to a securities arbitration ruling.
Gregory Torretta, a 29-year industry veteran, filed the
claim in 2011, initially seeking $4.5 million in damages.
The decision marks an unusual instance of a securities
industry professional winning a wrongful termination suit
against a brokerage, say lawyers.
A Morgan Stanley spokeswoman said the brokerage disagrees
with the decision and is considering its options.
The dispute between the brokerage and Torretta, who managed
a two-branch Morgan Stanley complex in Garden City, New York,
stemmed from his oversight of another manager who was not
adequately doing his job, according to Marc Dobin, a lawyer in
Jupiter, Florida, who represented Torretta.
That manager became frustrated by the oversight process and
sent Torretta an email to complain. The manager, who copied
Torretta's boss on the message, also implied in writing that
Torretta had discussed leaving the brokerage and suggested that
the underperforming manager join him, according to Dobin.
Torretta denied having such a discussion with the manager.
But the allegation, since revealed to Torretta's boss, gave rise
to abrupt action against Torretta, according to Dobin. Morgan
Stanley gave him the choice of voluntarily resigning or being
terminated, according to Dobin. Torretta resigned and now works
for Ameriprise Financial Services, Inc, according to a
The panel, as is customary, did not explain the reasons for
its decision. But Morgan Stanley's own procedures for handling
such a dispute were a key factor in the case, Dobin said.
Torretta's case hinged on the allegation that Morgan Stanley did
not follow those procedures, which required, among other things,
certain meetings and possible involvement of the human resources
department, Dobin said.
The underperforming manager was later fired.
"We view this as a vindication," Dobin said.