Ex-Morgan Stanley Banker Wins $1.6 Million Bonus in Lawsuit
(Bloomberg) — Former Morgan Stanley deal maker Bernard Mourad won bonuses worth more than 1.4 million euros ($1.6 million) after a Paris court ruled that the American bank improperly withheld deferred pay when he quit in 2015 to join up with telecoms mogul Patrick Drahi.A judge at the Paris employment tribunal ruled Monday that Morgan Stanley owes Mourad nearly 1.2 million euros linked to deferred pay in shares for work performed between 2012 and 2014 and 250,000 euros for another bonus.
The lawsuit centers on a deferred compensation scheme Morgan Stanley designed to reward loyalty. The case also raised a broader question of whether New York law that applies to Wall Street banks could trump French legislation. The dispute is expected to go all the way to France’s top court.
A court official read the outcome of Mourad’s lawsuit by phone but full details of the decision may not be available for weeks. Representatives at Morgan Stanley declined to comment on the ruling.
Mourad’s lawyer is still waiting to see on what grounds his client won but considers the full award of the differed bonus suggests the tribunal ruled that the loyalty scheme was unlawful.
“It seems the judge decided to prohibit a system that consist in paying later — on condition of continued presence at the firm — a remuneration that had been earned during a past period of time,” Mourad’s attorney, Eric Manca, said by phone.
Mourad now works for Bank of America Merrill Lynch as head of investment banking in France. He left Drahi’s Altice Media Group in 2016 to take a role on Emmanuel Macron’s presidential campaign and was then active in various business ventures.
Morgan Stanley has argued that the incentive plan, which was set up in the U.S., has a delayed vesting schedule to acquire the rights to the payout. The bank said Mourad’s stature as a top executive meant he couldn’t ignore the requirement that he stay at the firm to collect it.
Mourad, on the other hand, said he never signed any document consenting to the time frame or the application of New York law.
Manca also said his client was one of the most profitable employees at Morgan Stanley. In about four months in 2015, Mourad generated nearly $50 million in fees after having billed clients for more than twice as much the previous year when he orchestrated the $23 billion takeover that combined Drahi’s Numericable Group with rival cable and wireless provider SFR, Manca said during one of the court hearings.
Marie-Alice Jourde, a labor-law attorney who isn’t involved in the Mourad case, says France’s top court — the Cour de Cassation — hasn’t typically awarded defered bonuses to employees who’ve left a firm but this ruling could be the first step toward fresh case-law.