A Morgan Stanley hold-out could rupture the settlement, sources said. Moreover, the strategy could backfire and leave Morgan more vulnerable. "Morgan's strategy all along is 'we have to fight this and keep fighting it," said Woker. "So far it's working. But as soon as you lose with that strategy you lose much bigger." Sources at the meeting recalled that all the firms were in agreement that reforms were indeed needed. Ten top brokerages were represented at the meeting, and there are 12 brokerages under investigation, sources added. The SEC and the Attorney General's office declined to comment. Morgan Stanley officials declined to comment. But sources familiar with the discussions there said: "haggling continues over details."