An Italian appeals court has ruled it cannot hear a case against Morgan Stanley in a derivatives case which included a request for 2.7 billion euros ($3 billion) in damages from the U.S. bank.
The ruling, seen by Reuters in a document filed on Thursday, confirms a decision taken in June by Italy’s Court of Accounts saying it did not have jurisdiction in the matter.
The case revolves around Morgan Stanley derivative transactions made by the Italian state between 1995 and 2005 and terminated in December 2011 and January 2012.
The Italian state incurred large losses on its derivative positions.
State prosecutors had argued some contracts negotiated with the U.S. bank were speculative in nature and contained termination clauses that were overly advantageous to the bank.
Morgan Stanley said it welcomed the judgment and did not comment further. In the past the bank has repeatedly said the claim was groundless.
The case also includes claims against former senior officials at Italy’s Treasury for a total of 1.18 billion euros. All the defendants have denied any wrongdoing.
"It’s the right ruling, which fully reflects the defence’s reasons," said Mario D’Urso, the lawyer representing former Treasury Director General Vittorio Grilli.
Prosecutors in the case can appeal the decision to Italy’s Supreme Court.
(Published by Bloomberg, March 8 2019)
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