When Morgan Stanley Talks

Allegations of conflict of interest were properly alleged in litigation against the Blank Rome law firm, according to this decision of the New York Appellate Division for the First Judicial Department.

the complaint alleges that defendants concealed a conflict of interest that stemmed from defendant law firm’s attorney-client relationship with Morgan Stanley while simultaneously representing plaintiff in divorce proceedings against her ex-husband, a senior Morgan Stanley executive, who participated in Morgan Stanley’s decisions to hire outside counsel..

plaintiff identifies the nature of the conflict as stemming from defendants’ interest in maintaining and encouraging its lucrative relationship with Morgan Stanley and the impact of that interest on defendants’ judgement in its representation of plaintiff in the divorce proceedings..

Further, the complaint alleges numerous acts of deceit by defendants, committed in the course of their representation of plaintiff in her matrimonial action. Additionally, the complaint sufficiently alleges that the individual defendants knew of but did not disclose defendant law firm’s representation of Morgan Stanley to plaintiff, and it details the calculations of her damages.

The allegations were not subject to strike as scandalous or prejudicial. (Mike Frisch)