"everyone's budgets went up"

September 17, 2001: "The SEC has not quantified the number of active cases in which substantial files were destroyed. Reuters news service and the Los Angeles Times published reports estimating them at 3,000 to 4,000. They include the agency's major inquiry into the manner in which investment banks divvied up hot shares of initial public offerings during the high-tech boom.

The EEOC said documents from about 45 active cases were missing and could not be easily retrieved from any backup system. One of these cases was a sexual harassment charge filed on Sept. 10 against Morgan Stanley, one of the prime corporate victims of the World Trade Center disaster. Some data, he added, "won't be recreatable." "Ongoing investigations at the New York SEC will be dramatically affected because so much of their work is paper-intensive," said Max Berger of New York's Bernstein Litowitz Berger & Grossmann. "This is a disaster for these cases."

The EEOC's New York office, which was housed in 7 World Trade Center, sustained no loss of life. But all the agency's records were destroyed. Many of the files are backed up in the computer system, but a substantial number of documents are simply gone, said Spencer Lewis, the EEOC district director. Depositions and notes were not scanned into computers and are lost. With depositions and interviews, the agency will be contacting court reporters "and hoping that they've got them so we can reconstruct files," Lewis said. This covers about 45 active cases, including a recent action against Morgan Stanley."

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