John and Peter Lang, Steven Ayer, Roman Ciosek and Jeffrey Sullivan , who worked together as the Strata Group, left the investment bank to work for HighTower earlier in the month.
However, a law suit against the men has been launched by Morgan Stanley, which claims the traders are in violation of their contracts with the bank.
The financial institution alleges that while planning to leave, the traders invited their client base to join their new firm and appropriated confidential data including account details and performance reports.
Elliot Weissbluth, chief executive officer at HighTower, described the lawsuit as lacking substance and the bank was attempting to intimidate a new rival.
However, a representative for the bank, warned: âMorgan Stanley Smith Barney has a strong case. It would not have filed it otherwise.â
Morgan Stanley has filed an action against the Strata Group and HighTowers to recover finances and damages.
By Jim Ottewill