Much of the information LVMH deems damaging, and indicative of bias, is contained in newspaper articles. For example, LVMH said in the suit that Morgan Stanley’s managing director and head of mergers and acquisitions, Michael Zaoui, exaggerated LVMH’s debt situation in a published interview in March 2002, pegging its gearing at 37 percent instead of 28 percent. The comment dovetailed on Kent’s warnings in one of her reports of a potential LVMH credit downgrade, which the suit characterized as "fantasy." The suit suggested such information could influence the public and sway investors waffling between buying LVMH or Gucci stock.
As reported, among the most contentious points in the suit are boilerplate statements in Morgan Stanley reports stating it had a director in common with LVMH and that it would be seeking compensation from the French group for investment banking advice. LVMH contends both are erroneous statements that were only removed by Morgan Stanley under the threat of legal action.
"The deliberate will to deceive the public and discredit LVMH is clear," the suit claimed.
Two internal Morgan Stanley e-mails, one sent at 11:07 a.m., and another at 8:41 p.m., are listed as evidence. It’s not clear how they were obtained. Both concern the possible quest for LVMH business.
The writ further detailed that the $100 million LVMH seeks is for damages, as well as to mount advertising campaigns "in several countries" to help boost its image "which has been tarnished by the declarations and writings of Morgan Stanley." LVMH is also seeking to recoup some $30,000 in legal costs. Also, if Morgan Stanley loses the case, LVMH wants the court to order it to publish an announcement in "three daily financial papers with international scope."