Paris ? Investment bank Morgan Stanley must pay at least $38.5 million in damages to luxury goods maker LVMH Moet Hennessy Louis Vuitton for publishing biased research against its brands, a French court ruled Monday.

In a landmark first ruling by a European court on conflicts of interest between research and investment banking services, the Paris commercial court said the U.S. investment bank’s research had “considerably prejudiced” LVMH’s activities and reputation.

LVMH, whose products range from Vuitton bags to Moet et Chandon champagne, had demanded $128.5 million in damages.

It argued that Morgan Stanley had carried out a three-year campaign of “systematically erroneous and biased information” against LVMH while hiding its business relationship with rival Gucci.

Ordering the initial $38.5 million in punitive damages, the court said further financial compensation would be given later.

Morgan Stanley vowed to appeal the ruling.