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Frasers Group seeks US court order to involve Morgan Stanley CEO in UK lawsuit

Frasers Group, the UK-based retail conglomerate led by Mike Ashley, has asked a New York court to compel Morgan Stanley CEO James Gorman to provide evidence for a UK lawsuit against the bank, according to an announcement made on Friday. The lawsuit pertains to a disputed $1bn margin call related to trades in Hugo Boss, which Frasers alleges was maintained "arbitrarily" and "incorrectly" by the bank.

The lawsuit was first launched in 2021 after the bank tried to force Frasers to close options positions it had established in Hugo Boss. The retailer claims this action resulted in millions of dollars in losses. Frasers is seeking €50m ($58m) in damages to cover these losses.

In May 2021, Morgan Stanley issued a margin call of £810 million ($1.1bn) on Saxo Bank, which was connected with certain put and call options in Hugo Boss that were ultimately held by Frasers. Saxo Bank attempted to pass the margin call onto Frasers, but the retailer obtained injunctive relief in June 2021, preventing the banks from taking any steps related to the margin call.

Despite this, Ashley reportedly offered £100 million ($137m) and his entire £1.9 billion ($2.6bn) stake in Frasers as collateral to meet the margin call, an offer that was refused.


Now, Frasers is demanding that Gorman, who has been at the helm of Morgan Stanley since 2010, testify and produce documents related to the case. This move marks a significant escalation in the ongoing legal dispute between Frasers Group and Morgan Stanley.

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