Lyft threatened Morgan Stanley with legal action earlier this week, demanding in a letter the investment bank stop marketing a short-selling product that the ride-hailing firm believed was disrupting trading in its stock, according to four people familiar with the situation.
The letter, sent on April 2, cited an article in the New York Post published on Monday night that said the bank was marketing a product that appeared to offer Lyft’s pre-IPO shareholders a way to get around lockup agreements that prevent them from selling for at least six months after the IPO. If true, the letter said, Morgan Stanley “is engaged in tortious interference” and the company demanded the firm stop sales of the product or face legal action.
