Morgan Stanley Broker in CA Sues Over Age/Disability Discrimination
A Morgan Stanley broker with four decades of industry experience who took a salaried position for three years while being treated for a brain condition has sued the firm over age and disability discrimination.In a lawsuit transferred to a federal district court in California on Tuesday, David A. Dougherty alleged that Morgan Stanley permanently reassigned his accounts to a younger partner and forced him to remain in a non-producing role as a “business development associate” when he sought reinstatement as a producer in January 2018.
He had agreed to the salary-plus-bonus role in January 2014 for a three-year period after being diagnosed with a subdural hematoma, expecting to return to the higher-earning role after receiving medical approval, according to the lawsuit.
Dougherty, 72, initially filed the complaint in Los Angeles County Superior Court in April.
Age discrimination has not been widely asserted in the securities industry, unlike gender and race discrimination, but plaintiffs’ lawyers said it is gaining more prominence given the aging of the brokerage force. The average financial adviser is over 50, according to a 2018 study by Ernst & Young.
“The average age keeps creeping up, so I would expect there to be more of these cases in the future,” said Robert L. Herskovits, a New York lawyer who represents firms and brokers in employment and securities litigation.
Dougherty, who first registered as a broker in 1976 at Merrill Lynch, seeks unspecified compensatory and punitive damages and attorneys’ fees as well as reinstatement as a financial advisor, according to the lawsuit before the Central District of California U.S. District Court. It cites six counts under California discrimination statutes, in addition to breach-of-contract and other state employment laws.
Dougherty alleged that he agreed to an annual salary of $100,000 salary and a $30,000 bonus for three years until December 2017. When he sought reinstatement, his Los Angeles complex manager told him there was “not enough business” to justify it, the lawsuit said.
His book of business was given to Nick Takahashi, who joined Morgan Stanley together with his older partner in 2013 from Wells Fargo Advisors. The lawsuit describes Takahashi, who has been a broker for 11 years, as Dougherty’s “protege” and partner but said that the younger broker took a 60% split of their production.
“Plaintiff’s age was a substantial motivating reason for defendant’s decision to refuse to reinstate plaintiff into his original financial advisor position,” the complaint asserts. “Defendants have hired substantially younger employees with less experience than plaintiff into the financial advisor position at defendant’s Long Beach office.”
The lawsuit names Morgan Stanley Smith Barney plus unnamed “John Does” who can be added later as defendants. Michael C. Robinson, Dougherty’s lawyer, declined to comment.
In an interview Tuesday, Dougherty said his chief goal is to be reinstated as an advisor so he can work at the profession he loves.
“I’ve been a broker my whole life,” he said. “I frankly don’t need the money, but I like what I do a great deal.”
A Morgan Stanley spokeswoman did not return a request for comment.
Herksovitz, the employment lawyer, said that age discrimination claims are challenging for plaintiffs.
“The person is going to have to prove that systematically there’s a culture of weeding out the older folks simply to promote the younger ones,” he said. “That’s not an easy thing to prove.”