Morgan Stanley May Face Wave of Suits After Admitting It Withheld E-Mail Evidence

As predicted in an earlier post on The Datakos Blawg titled “What is Happening to Morgan Stanley Could Happen to You,” Morgan Stanley is beginning to feel the ripple effect of its problems with email backup tape maintenance and controls.  The Daily Business Review reports “[a]ttorneys say they are gearing up to file hundreds of lawsuits against Morgan Stanley for allegedly hiding evidence from clients who filed arbitration claims.” 

 The residual effects of a bad outcome in a case of poor records management can be felt for many years to come.  For this reason, corporate leaders will have a difficult time avoiding any longer the need to invest and make a concerted effort to improve records and information management compliance.  The rationale that a bad event stemming from records management deficiencies is a “one off” or “unlikely to recur” simply will not cut it.  Once an organization gets sanctioned for signficant records management flaws, expect collateral attack from former litigants and regulators, who will attempt to reopen settlements and adjudications where evidence is perceived to have been withheld or carelessly destroyed.


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