A former Morgan Stanley broker in Cornelius, North Carolina, accused the firm of discriminating against her and wrongfully reassigning $40 million in client assets as she recovered from multiple spinal surgeries.
Elizabeth Hobson, who is now with LPL Financial, filed claims of disability and gender discrimination on Monday in federal court in North Carolina. Hobson, a 14-year broker, also accused the firm of violating her protected medical leave and effectively forcing her to resign in June 2025.
Morgan Stanley managers improperly transferred assets that had been part of a joint production agreement between Hobson and a former partner who left the firm, according to the complaint. The assets were directed to a male advisor in early 2024 after managers questioned whether Hobson could “handle” the accounts following surgery, according to the complaint.
In one example, a $5 million household was returned to her after the client objected to being moved to the transfer, but a $600,000 rollover had already been credited to the male advisor, Hobson alleged. In another instance, a delayed credit for an insurance policy caused her payout grid rate to drop to 28% from 36%, the lawsuit stated.
Hobson also alleged in the 65-page complaint that the firm failed to accommodate her disability by refusing to provide her a standing desk and denying her remote work and a dedicated sales support staff.
“Morgan Stanley’s branch and complex management…strung out for years even the most modest accommodations for her serious, surgically documented cervical spine condition,” Hobson wrote. “They called her ‘a girl’ who could not ‘handle’ her job.”
A Morgan Stanley spokesperson said the firm intends to “vigorously defend” itself against the allegations “in the appropriate forum.”
“Morgan Stanley is committed to providing equal employment opportunities and to fostering a workplace that is fair, inclusive, and respectful,” a firm spokesperson said in a statement.
Hobson resigned in June 2025 although she had in six of the past seven years received the firm’s “Pacetter’s Club” award for top performers in the complex. She also said she had ranked at the top of her complex in terms of net new assets, client retention, client contact and revenue growth.
The wirehouse had suggested that Hobson and her former partner had “agreed” in an email exchange in January 2024 to the distribution of the jointly managed accounts, including that some would be transferred to the male advisor. But Hobson alleged that the firm had unilaterally decided which accounts would transfer.
Hobson said she had gone through Morgan Stanley’s internal dispute resolution process but that it was “an endless loop of forms, case numbers, 800 numbers, ‘processes’ and ‘investigations’ designed to exhaust the complaining employee.” The complaint seeks unspecified damages for back pay and emotional distress as well as legal costs.
Hobson started her career at Northwestern Mutual in 2011, moved to Park Avenue Securities in 2013 and joined Morgan Stanley as an advisor trainee in 2016, according to BrokerCheck and the complaint.