Dollars and Jens
Wednesday, July 20, 2005
A pension fund on Tuesday sued Morgan Stanley directors, alleging they tolerated "grotesque mismanagement" by former Chief Executive Philip Purcell and former co-President Stephen Crawford before the men reaped excessive exit payments.Chicago Tribune (requires registration).
I'm not sure I've heard explicitly, and this story sure doesn't give details, but I'm left with the impression that much of the relief being sought is injunctive, and that the fund may not in fact be seeking any monetary payment. If so, this is to be held up as the kind of shareholder lawsuit that should go forward, and the people responsible granted titles of nobility, the U.S. Constitution notwithstanding. If management oversteps its bounds, shareholders should absolutely be given any reasonable chance to effect a correction, and, where appropriate, to sanction the individuals responsible. They should not punish the shareholders who remain.