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A Manhattan Supreme Court judge has denied Morgan Stanley Dean Witter’s request for an injunction barring a New York lawyer from representing former Morgan Stanley employees in current or future matters adverse to the financial services giant. Morgan Stanley had sought to enjoin Michael B. Carlinsky and his law firm, Quinn Emanuel Urquhart Oliver & Hedges, on the grounds that Carlinsky, while a partner last year in the New York office of Orrick, Herrington & Sutcliffe, had represented Graystone Wealth Management, a division of Morgan Stanley & Co., a subsidiary of Morgan Stanley Dean Witter, in suits to prevent brokers from leaving with their clients. In current litigation, Carlinsky, who is a partner in Los Angeles-based Quinn Emanuel’s New York office, is representing departing Morgan Stanley brokers in California and Texas. In an order issued Monday, Manhattan Supreme Court Justice Richard F. Braun noted the similarity between the representations, but said Morgan Stanley had not demonstrated a sufficient relation between Carlinsky’s past representation of Graystone and his current representation of former Morgan Stanley brokers now being sued by their old company to prevent them from bringing their brokerage clients to their new home at Bank of America. “Granting of the preliminary and permanent injunction sought would be the functional equivalent of a temporary and then permanent disqualification of defendants as attorneys for their clients,” Justice Braun wrote in his opinion. “Doing so would deprive the clients of an important right: counsel of their choice.” Braun also lifted a temporary restraining order he issued Nov. 13 prohibiting Carlinsky and Quinn Emanuel from working at all on active matters adverse to Morgan Stanley in Texas and California. That restraining order came the night before a National Association of Securities Dealers arbitration panel in California was to convene to hear one of the matters, Carlinsky recalled Tuesday in an interview. “Under the original terms of the order, I couldn’t even call my clients and tell them why I couldn’t talk to them,” said Carlinsky. Morgan Stanley’s request for injunctive relief was unusual and particularly harsh in a situation where moving to disqualify might have been the standard approach. Indeed, Morgan Stanley had sought disqualification in federal court in California. Morgan Stanley had argued to Justice Braun that more drastic measures were necessary because Carlinsky’s familiarity with Morgan Stanley’s policies and strategies, gained in confidence from the Graystone matter, represented a “danger of disclosure” justifying injunctive relief. J. Michael Riordan, the partner at New Jersey’s Bressler, Amery & Ross who represented Morgan Stanley, did not return a call seeking comment. Carlinsky called Morgan Stanley’s seeking of injunctive relief “outrageous,” and a “pure litigation tactic designed to prevent me from zealously representing my clients.” He also said Morgan Stanley’s move, if successful, would have severely impaired his ability to function as a lawyer. “Aside from besmirching my reputation and questioning my legal ethics,” Carlinsky said, “professionally, it would have shot down a practice area in which I have specialized.” Carlinsky, who was represented by Quinn Emanuel partner Jeffrey A. Conciatori, said his representation of Graystone had been based on legal strategies developed in other cases and ended in settlement shortly after Orrick’s engagement without extensive contacts with Graystone personnel, much less employees of Morgan Stanley & Co. or Morgan Stanley Dean Witter. Carlinsky said he had suffered financial hardship from the 30 days he had been restrained from representing his clients, and would not rule out filing his own action against Morgan Stanley. To that extent, Quinn Emanuel on Dec. 12 requested that Morgan Stanley post a $500,000 bond to cover potential damages, which Justice Braun subsequently authorized.

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