In a significant legal development, Morgan Stanley, Barclays Capital, and DRW Securities LLC have won the dismissal of a lawsuit that was filed against them over allegations of manipulating the VIX index in 2018. The U.S. District Judge ruled that the claims made by investment funds Two Roads Shared Trust and LJM Partners Ltd., were unsupported and time-barred.
The investment funds had accused these financial institutions of causing losses due to manipulated volatility index calculations by Cboe Global Markets (NYSE:CBOE). However, the court did not find sufficient evidence to support these allegations.
Despite this legal victory, Morgan Stanley has seen a decline in its stock performance this year. The company's shares have dropped by 5.4%, leading to a Zacks Rank #3 (Hold) status.
On a related note, Wells Fargo & Company (NYSE:WFC), under the leadership of CEO Charlie Scharf, has also managed to get a lawsuit dismissed recently. This case was centered around alleged fraudulent diversity hiring practices. Unlike Morgan Stanley, certain companies like Boston Beer (NYSE:SAM) Company and NVIDIA (NASDAQ:NVDA) have witnessed substantial stock growth recently.
This series of legal developments underscores the active role of courts in shaping the landscape of financial markets and corporate governance. It also highlights the ongoing challenges faced by companies in navigating complex legal issues while striving to deliver shareholder value.
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