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Morgan Stanley officials and a lawyer for the firm have denied many of Ms. Schieffelin's accusations and vowed to disprove them in court. But if the commission follows through with its intended class action -- the first by the commission against a major investment bank -- Morgan Stanley will have to explain why so few women have advanced to its senior management ranks.

In a complaint filed in the United States District Court for the Southern District of New York, in Manhattan, Ms. Schieffelin said that when she was fired in October 2000, there had never been a female managing director in her department, which handles bonds that are convertible into shares of a company's stock. In the entire division, known as institutional equities, women held only 3 of about 50 managing director titles, she contended. A lawyer for the firm said those numbers were wrong but declined to provide others.

In interviews arranged by the commission, women who worked with Ms. Schieffelin at Morgan Stanley described a working environment in which men swapped off-color jokes and tales of sexual exploits and treated their female colleagues as inferior -- all with impunity. These women voiced similar complaints about being paid less than their male peers and being passed over for promotions that went to men they regarded as less qualified. The women spoke on the condition of anonymity, fearing harm to their careers, but they may testify if the case goes to trial. Commission lawyers say the number of plaintiffs in the group could exceed 100.

''There's no doubt in my mind that women were compensated less than men at the same level,'' said one longtime colleague of Ms. Schieffelin's. ''A lot of us had these complaints.''

Another recalled that after she resigned from Morgan Stanley several years ago, she told a woman from the personnel department in an exit interview that the firm treated women unfairly. ''The woman from human resources said they were trying to correct that,'' this former employee said. ''She said that would be one of their 'pet projects.' ''

Sheila Wellington, the president of Catalyst, a nonprofit research and advocacy group that has surveyed women on Wall Street, said Ms. Schieffelin was ''not unique -- she's not unusual'' in feeling that sex discrimination remained rampant in the securities industry.

NO matter how many women come forward, there is little chance that any will have a stronger emotional attachment to Morgan Stanley than Ms. Schieffelin had -- and, to a surprising degree, still has. Before she went public with her complaint, nobody would have cast Ms. Schieffelin as Norma Rae in a power suit. (With her dark hair, wide eyes and wispy voice, she looks and sounds more like Debra Winger than Sally Field.)


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Even after she was unexpectedly called into an office, coat in hand, and summarily fired, Ms. Schieffelin could not let go. A small tear glistened on her right cheek during an interview last month as she recounted being escorted out of Morgan Stanley's headquarters in Times Square, barred from stopping at her desk on the stock trading floor.

''My ID was taken away -- I asked them, 'Can't I just keep my ID as a memento?' '' she recalled. She has been out of work since then.

Morgan Stanley has said in court documents that her dismissal was a delayed reaction to an ''outrageous act of insubordination'' in which she, according to the documents, responded to a request from a supervisor, Gay L. Ebers-Franckowiak, by swearing and physically threatening her. That confrontation, two weeks before Ms. Schieffelin was fired, was the last ''in a series of problematic incidents'' involving her, said Emily Nicklin, a partner in Kirkland & Ellis, the Chicago law firm that represents Morgan Stanley.

For some of Ms. Schieffelin's colleagues, the surprise was not that she was fired. The real puzzle was how she had managed to survive for almost two years in the nerve center of a hypercompetitive organization after making her sex-discrimination complaint to the E.E.O.C. in December 1998 -- an act that many of her co-workers and most of her bosses saw as some combination of betrayal and career suicide.

Looking back now, Ms. Schieffelin traces her troubles to 1995. That year, in a written review of her boss, Frank Pratt, she said he ''makes the convertible department and the firm by extension an uncomfortable place for women.''

She added, ''He views men as 'aggressive' and women as 'snippy'; in tough situations, men are 'frustrated,' women are 'too sensitive.' ''

In 1995, Ms. Schieffelin also complained about unwelcome advances by a male managing director. After her internal complaint, Morgan Stanley disciplined the man and sent him for counseling, Ms. Nicklin said. She said the company decided that further punishment, including demotion, was not warranted. ''He asked her to go out on a date a number of times,'' Ms. Nicklin said.

MS. SCHIEFFELIN said she had thought her bosses appreciated her having handled the matter discreetly, but last month she said, ''I believe that management put me on their watch list from the time of the sexual-harassment complaint.''


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When she took her discrimination accusation outside the firm three years later, she went from being watched to being unwelcome, she said. That tense period culminated in her confrontation with Ms. Ebers-Franckowiak. According to Ms. Nicklin, Ms. Schieffelin loudly and crudely showed up her supervisor by refusing to follow an instruction, sticking a finger in Ms. Ebers-Franckowiak's face and cursing her.

Wayne N. Outten, a lawyer for Ms. Schieffelin, said Ms. Nicklin's description of the episode was exaggerated. But even if it were accurate, he said, there was no precedent for firing somebody for such behavior.

Ms. Schieffelin never thought things would dissolve into such acrimony. Indeed, she said she thought she could remain in good stead after complaining to John J. Mack, then the president of Morgan Stanley, about not being promoted -- and still felt that way after taking her complaint beyond the firm's executives to the E.E.O.C.

''I really thought that they were going to say: 'Gosh, we know Allie. This is somebody who has been a team player for all of her career,' '' Ms. Schieffelin said. ''I still had that optimism. I thought they were going to say, 'We have got to fix this.' ''

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Instead, she said, the company embarked on a ''campaign to get me to quit.'' Her supervisors and some colleagues ostracized her socially, she said, and stopped sharing market news that was vital for her to have to compete for business. Ms. Schieffelin, who had been the firm's highest-paid seller of convertible bonds, fell behind Ms. Ebers-Franckowiak in 1998, Ms. Nicklin said.

Convertible bonds trade over the counter, with firms like Morgan Stanley quoting the prices, in eighths of a dollar, at which they will buy or sell them. Traders have some leeway in the prices they quote to sales representatives like Ms. Schieffelin. After she complained about discrimination, she said, the prices that traders for the company gave her became less competitive. ''You're always off by an eighth,'' she recalled one client telling her.

There were other changes, she said. Within weeks after complaining to Mr. Mack, Ms. Schieffelin said, she was told that she would no longer be sent to recruit at Northwestern University, where she got her M.B.A.

Her ex-husband, David Schieffelin, who had not spoken to her in more than seven years, said his ex-wife had thoroughly bought into the system, hinting that Ms. Schieffelin's devotion to her job had contributed to their breakup. ''She had Morgan Stanley running through her veins,'' he said. ''She did anything these guys needed her to do, whether it was working 75 hours a week or coming back from a vacation. She took up golf for these people.''

For years, Ms. Schieffelin said, she routinely took one-day trips to California to meet with clients. Often, she said, she would leave the trading floor in Manhattan in time for a 3 p.m. flight to Los Angeles. She would have dinner with a client there, then hop on a plane back to New York.


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''I really made the choice not to have a family,'' Ms. Schieffelin said in an interview in September. ''I couldn't even have a goldfish.''

She said she had willingly made the sacrifices she thought necessary to achieve her main career goal: becoming a Morgan Stanley managing director. Fewer than 1,000 of Morgan Stanley's 61,000 employees worldwide are managing directors, and for the most part, they are the firm's highest-paid employees.

For Ms. Schieffelin, becoming a managing director could have meant that her income would triple or quadruple. She wanted the recognition even more than the money, she said.

For her first 10 years at the firm, Ms. Schieffelin said, she thought she was on track for that big prize. She was successful and well liked by clients and co-workers, she said.

She prided herself on being able to thrive among the men who dominate Morgan Stanley's trading floor. She tolerated their tendency to see women as unsuited for the work and to exclude women from firm-sponsored outings and nights out with male clients, she said.

After she played host at a dinner with clients and male colleagues in 1997, for example, the men ushered her into a taxi that would take her home, she said. Then they piled into a limousine and went to Scores, a strip club on the East Side. The next day, she said, she heard of the fun that the men had had with her clients amid the topless dancers.

Ms. Schieffelin said Mr. Pratt, a managing director who was her supervisor, not only condoned such behavior but took part in it. Mr. Pratt did not respond to requests for an interview.

Ms. Nicklin, the lawyer for Morgan Stanley, said the issue of entertaining clients at strip clubs ''is a complete red herring'' and had nothing to do with the merits of the case. Attending such events, she said, was not required to advance at the firm.


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Ms. Schieffelin said she first realized that she might not rise further when she was not promoted at the end of 1996, after again leading her department. A few months later, she said, she met with Vikram Pandit, who then ran the institutional equities division, and asked to be transferred because she said Mr. Pratt discriminated against women and was holding her back. Mr. Pandit, now co-president for institutional securities, took no action, she said. He declined to comment for this article.

After Ms. Schieffelin was denied a promotion again at the end of 1997, she said she asked Mr. Pratt if she would ever be promoted. She recalled his reply as ''Not that I see.''

MS. NICKLIN said the convertible-bond desk had a managing director during those years, so ''there wasn't an opening'' for Ms. Schieffelin to fill. When the job did open up, at the end of 1999, it went to Ms. Ebers-Franckowiak, who is older than Ms. Schieffelin, because she was ''more experienced and more qualified'' and her performance had ''eclipsed'' Ms. Schieffelin's, Ms. Nicklin said.

During the late 1990's, the time covered by the E.E.O.C. suit, she said, the firm promoted about 10 percent of the women who were eligible to become managing director. In those years, the promotion rate for men was the same, she said.

Mr. Outten and lawyers for the commission said data gathered from Morgan Stanley on its pay and promotion practices would show otherwise. They said it was no coincidence that Ms. Ebers-Franckowiak became the first woman managing director in the convertibles department in New York a year after Ms. Schieffelin complained to the commission.

Soon, Ms. Schieffelin was told to report to Ms. Ebers-Franckowiak, who in turn reported to Mr. Pratt. She contended that Ms. Ebers-Franckowiak and Mr. Pratt created a ''hostile work environment'' by berating her in front of co-workers for mistakes she had not made, banning her from talking to one client and reassigning some of her clients to other sales representatives. ''It was so hard to do my job every day,'' she recalled. ''I told myself to keep focusing on my clients, keep focusing on my clients. If I lost my clients, I would have lost everything.''

MS. SCHIEFFELIN, who was the captain of her high school lacrosse team, never seriously considered quitting to work for a competing firm, she said. Her older sister, Julie Shemitz, an assistant United States attorney in Los Angeles, said perseverance had been drilled into the children by their father, who owns a lighting-design business in Connecticut. ''He never let us give up,'' Ms. Shemitz said.

Still, she added, the office shunning took its toll on her sister. ''It was miserable,'' she said. ''She went from having this cheerful, upbeat, gung-ho feeling about work to feeling like it didn't matter how hard she worked or how dedicated she was.''

While she still has a certain fondness for Morgan Stanley, Ms. Schieffelin acknowledged that her outlook had changed.


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''It's been a long, draining, emotionally taxing fight,'' she said, still struggling to fit the role of champion of women's rights on Wall Street. ''If I had one ounce less conviction about the existence of gender discrimination, there is no way I would put myself through it or ask other people to put themselves through it.''

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Source : http://www.nytimes.com/2002/02/10/business/wall-street-highflier-to-outcast-a-woman-s-story.html

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