Ex-Morgan Stanley Stockbroker Claims Sex Discrimination

A former Morgan Stanley stockbroker filed a sex discrimination lawsuit against Morgan Stanley on Tuesday, alleging that the company retaliated against her, in part, for complaining about rampant viewing of pornography in the workplace.

The lawsuit comes nearly two years after Morgan Stanley settled a sex discrimination case for $54 million only minutes before a federal trial was to begin between it and the Equal Employment Opportunity Commission. The EEOC claimed the company failed to pay and promote women equally in a section of the firm's investment banking division. At the time of the trial, the New York Times reported that details involving sexual harassment and trips to strip clubs with clients were expected to emerge in the trial.

The plaintiff in the lawsuit that was filed Tuesday, Kathryn O'Hagan, alleges that following her complaints of sexual harassment in 2002 and 2004, her boss took her accounts away from her, refused to give her an office, and withheld promotions. The legal complaint, filed in federal court in Manhattan, also alleges that at the "Grand Central Branch" of Morgan Stanley on 330 Madison Avenue, stockbrokers and at least one manager often retreated to one office to watch pornography.

More than once, Ms. O'Hagan found pornographic magazines placed on her desk,and sexually explicit videos in her e-mail inbox, and obscene comments directed at her the complaint says.

"It seems that in the Grand Central office, pornographic emails were regularly distributed among male brokers and even male members of management," according to the legal complaint.

A spokesman for Morgan Stanley, John Franklin, declined to directly ad dress Ms. O'Hagan's allegations about the prevalence of pornography in the offices of Morgan Stanley stockbrokers.

On Ms. O'Hagan's lawsuit, Mr. Franklin said: "The EEOC completed a thorough investigation of this matter and dismissed the plaintiff's related complaint, finding no cause to believe that Morgan Stanley violated any laws. Morgan Stanley takes such issues extremely seriously, and when allegations like this are brought to our attention, we promptly investigate them and take action consistent with our well established policies."

A lawyer for the plaintiff, Michael Grenert, declined to comment.

Ms. O'Hagan joined Morgan Stanley in February 2001, according to the legal complaint. In her training class she was the number one ranked financial analyst, or FA in the vocabulary of Morgan Stanley, in the country. She began work at 2 World Trade Center on the 73rd floor. After September 11, 2001, she worked at the Grand Central Branch on Madison Avenue, which is where the alleged discrimination occurred.

On its Web site, Morgan Stanley states that 47% of its more than 45,000 employees in America are women. But among the financial analysts who sold stock to the general public at Ms. O'Hagan's new branch less than 10% were women, according to the complaint.

"In general Morgan Stanley favored male FAs over female FAs in the distribution of accounts," the legal complaint reads, referring to financial analysts.

Following her initial complaints, Ms. O'Hagan learned that she lost access to 167 of her accounts, meaning she could provide no information when a client called, according to the legal complaint. Later, and despite top performance, she was excluded from inheriting the accounts of departing colleagues, as other stockbrokers did, the complaint alleges. In all, she believes her claims of harassment cost her thousands of dollars in lost business.

The emails she sent to her boss went unreturned and unread, according to the complaint, which said he treated her as if she were "an office rabble rouser."

"O'Hagan, what trouble are you bothering me with now?" she remembers hearing, according to the complaint.

In April of 2004, she resigned and moved on to another brokerage house. The day she resigned, one colleague moved in on her clients, informing them that she had been fired, according to the complaint.