A former Morgan Stanley advisor won $150,000 in damages for the manner in which his employment at the Wall Street firm was terminated in a FINRA arbitration.
The panel said Morgan Stanley was liable for "causing humiliation, emotional distress and loss of book of business," according to FINRA records.
"It's strong language and you typically don't see this type of language in a FINRA award. You might see it in the relief requested, but not in the award from the panel," says attorney Thomas Lewis, of Stevens & Lee, a law firm in Lawrenceville, N.J.
Advisor H. Peter Petrosky was employed at Morgan Stanley in Palm Beach, Fla., from 2006 until 2013 when the firm discharged him. According to an entry in his FINRA BrokerCheck file, the firm cited concerns with regard to Petrosky's "solicitation and handling of a client account, including recommendation of third parties to [the] client."
In arbitration, Petrosky sought damages for wrongful termination, slander and disparagement to his business reputation and breach of implied contract. He asked for more than $3 million in relief for emotional distress and lost compensation and book of business, and to have the note expunged from his BrokerCheck record.
'RUSH TO JUDGMENT'
In October, the panel said Morgan had the legal right to terminate Petrosky's employment, but described the manner in which it was carried out as a "rush to judgment" that caused Petrosky unnecessary harm. In addition to the $150,000, the panel also ordered Morgan to pay Petrosky $600 for filing fees. Petrosky's remaining claims related to compensation were denied.
"Although we are disappointed that the panel awarded Mr. Petrosky any amount, we note that they correctly rejected the vast majority of his claims for $3.18 million, refused to expunge his Form U5, and rejected his request for a declaration that he was the prevailing party," a Morgan Stanley spokesperson said in an email.
Lewis, who did not represent either party in arbitration, says the panel's choice of language was more important than the actual amount Petrosky won.
"I think this is a strong message that Morgan Stanley's behavior was not acceptable to this panel," says Lewis.
Petrosky, now employed with Oppenheimer & Co. in Palm Beach Gardens, Fla., did not return calls seeking comment. His attorney, Andre Perron of law firm Barnes Walker, Goethe, Hoonhout, & Perron, declined to comment.
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