The battle between the world’s leading luxury goods group and one of Wall Street’s most powerful investment banks intensified on Monday as Morgan Stanley launched a $11.9m countersuit against Moet-Hennessy Louis Vuitton.
LVMH has produced 41 pieces of evidence that it claims prove bias in the work of Claire Kent, Morgan Stanley’s luxury goods analyst. These include a CD-Rom containing 1,900 pages of her research going back to 1999.
The bank said LVMH had taken Ms Kent’s words out of context, often truncating and manipulating them and that the proceeding was an attempt to damage Morgan Stanley’s reputation.
In its defence, it claimed all of its comments about LVMH were justified. “For research analysts to engage in self-censorship, by focusing on a company’s strengths while ignoring its weaknesses, would undermine the whole purpose of their research.”
Investment banks are anxious to limit exposure to civil suits following their $1.4bn settlement with Eliot Spitzer, the New York state attorney-general who argued that equity analysts puffed shares and slanted research to help colleagues win banking business.
LVMH is seeking €100m damages from Morgan Stanley.