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refused to pay this charge, Morgan Stanley reported to credit
agencies that Mr. Henderson had defaulted on the account.
B. Petitioner’s Lawsuit Against Morgan Stanley
On November 18, 1998, Mr. Henderson filed suit against
Morgan Stanley in the U.S. District Court for the Northern
District of California. On December 6, 1999, the parties reached
a settlement wherein Morgan Stanley agreed to pay Mr. Henderson
$5,000.
C. Settlement Agreement
Mr. Henderson and Morgan Stanley memorialized this
settlement by executing a document entitled “Settlement and
Release Agreement” (settlement agreement). The settlement
provides, in part:
1. [Morgan Stanley] shall pay to [Mr. Henderson] the
total sum of $5,000.
2. Effective upon receipt of the payment referred to
above, [Mr. Henderson] hereby releases and fully
discharges [Morgan Stanley] from any and all
claims, demands, damages, and causes of action
[Mr. Henderson] now has or in the future may have
for detriment alleged in the pending action.
3. [Morgan Stanley] hereby agrees to make a written
request to remove the Prime Option trade line from
the credit reports of the three major credit
agencies in regard to the matters raised in the
pending action.
4. [Morgan Stanley] agrees to arrange to have the
debt attributed to [Mr. Henderson] * * * forgiven.
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Last modified: May 25, 2011