Morgan Stanley, the second-biggest U.S. securities firm by market value, has won final approval of a $46 million settlement of a class-action lawsuit over claims it discriminated against women.
The settlement, reached in April, won preliminary approval in July from U.S. District Judge Richard Roberts in Washington. Roberts said at a hearing Thursday that he will grant final approval once a statutory 90-day period for notification of class members expires Oct. 24.
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“Congratulations to the parties for reaching an agreement,” the judge said. “The only thing left to do is to wait” until the deadline passes.
Six female former Morgan Stanley financial advisers sued the New York-based securities firm last year, claiming it discriminated against them and more than 3,000 current and former advisers since August 2003. The firm paid women less than men and gave them fewer promotion opportunities, the women claimed.
The settlement agreement includes an increase in earnings for female advisers by at least $16 million over five years. Diversity programs by Morgan Stanley will cost an additional $7.5 million, under the accord.
The agreement “is going to change a lot of the practices and policies” at Morgan Stanley, said Mara Thompson, a lawyer for the women with Sprenger & Lang, after the hearing.
The settlement at the time was the ninth-largest in a U.S. gender-bias class-action, or group lawsuit. The biggest, for $565 million, was a 2000 accord to end a lawsuit that 1,100 employees filed against the U.S. Information Agency and Voice of America.
In a separate sex-discrimination case in 2004, Morgan Stanley agreed to pay $54 million to settle a suit brought by a former bond saleswoman, Allison Schieffelin, and the U.S. Equal Employment Opportunity Commission.
James Wiggins, a spokesman for Morgan Stanley, said the firm was “pleased” with the court decision.
The firm is second-largest U.S. securities firm behind New York-based Goldman Sachs Group Inc. The case is Augst-Johnson v. Morgan Stanley, 06-CV-1142, U.S. District Court for the District of Columbia (Washington). •
