On August 4, 2008, State-Boston Retirement System was appointed Lead Plaintiff in a class action filed in federal court in the Central District of California, alleging securities fraud involving Morgan Stanley, one of America’s most prestigious and profitable financial services corporations.

Labaton Sucharow LLP was appointed Co-Lead Counsel, representing State-Boston and the investor class. On November 7, 2007, Morgan Stanley shocked the market by announcing that it would write down its assets by $3.7 billion to account for the decline in value of certain sub-prime mortgage related exposures that had not previously been disclosed to investors. On December 19, 2007, Morgan Stanley disclosed that the size of its write down would be even larger—$7.8 billion, and that, as a result of the write-down, it would record its first quarterly loss ever as public corporation. Plaintiffs believe that, among other things, this loss, and the inappropriate system of risk control at Morgan Stanley that allowed this loss to occur, should have been disclosed to investors at a substantially earlier date.

Along with its Co-Counsel, Labaton Sucharow filed an amended complaint. Morgan Stanley and the other Defendants moved to dismiss the complaint and the parties are presently engaged in the briefing on the motions to dismiss. Currently, the case is filed under the caption, McClure v. Morgan Stanley et al.