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Morgan Stanley has abandoned a potential settlement of a government lawsuit accusing it of discriminating against women employees, a lawyer for the Equal Employment Opportunity Commission said Thursday. The EEOC filed the suit in September 2001 on behalf of sales representative Allison Schieffelin and as many as 100 women in the firm’s institutional stock department. The suit, seeking unspecified compensatory and punitive damages, alleged that Morgan Stanley engaged in a discrimination pattern that prevented most women from advancing to the positions and salaries that less productive men achieved. Morgan Stanley has denied the allegations, and has said Schieffelin was dismissed after she initiated a confrontation with a supervisor. The company and the EEOC had been in discussions for more than a year and had settled the monetary terms of a settlement, with other details to be resolved, EEOC attorney Elizabeth Grossman said. But at a court hearing Thursday, Morgan Stanley lawyers told U.S. District Judge Richard Berman of the Southern District of New York that it was backing out of the settlement, Grossman said. Grossman said she did not know what prompted Morgan Stanley’s decision. She declined to reveal how much money the firm would have been required to pay, or other details, of the settlement. Morgan Stanley spokeswoman Judy Hitchen declined to comment Thursday. Schieffelin worked at Morgan Stanley for 15 years, rising to a position that paid her more than $1 million annually. She said a job that would pay several million dollars annually was reserved almost exclusively for men. Another hearing in the case has been set for March 31. Berman told the chairman of Morgan Stanley and the EEOC to attend that hearing, Grossman said. Copyright 2003 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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