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MBIA Targets Morgan Stanley In Latest MBS Suit

Law360 (December 8, 2010, 1:25 PM EST) -- In its ongoing litigation battle against major investment banks, MBIA Inc. has hit Morgan Stanley & Co. Inc. with a suit alleging that the bank misrepresented the quality of mortgages in a 2007 mortgage-backed securities offering that has cost the insurer more than $71.2 million in claims.

In a complaint filed Tuesday in the Supreme Court of the State of New York, Westchester County, the bond insurer claimed that Morgan Stanley made “demonstrably false written representations” about the quality of the security's component mortgages during negotiations,...
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