The $10.2 million settlement reached in 2019 between Morgan Stanley and financial advisors and brokers who alleged the wirehouse violated California law labor laws must go back to court after a U.S. Ninth Circuit Court of Appeals ruling on Monday.
U.S. District Court for the Northern District of California, "in approving the settlement, may have certified a class in which not all class members suffered an injury sufficient" to justify them being awarded damages as a result of alleged labor violations made by Morgan Stanley's Automated Flexible grid program, according to the Ninth Circuit Court ruling.
Morgan Stanley declined to comment on the ruling on Friday.
The settlement involved a class action complaint filed by ex-Morgan Stanley broker Brandon Harvey in May 2018 in which he claimed he and about 3,000 other advisors and brokers alleged the firm didn't correctly reimburse them for expenses.
Harvey was with the firm as a broker/rep from 2013-2018 and then left to join LPL Financial until 2021. He is no longer a registered broker or advisor, according to his report at the Financial Industry Regulatory Authority's BrokerCheck website.
