"When you read the complaint, you'd think Harvard was a widow, an orphan who'd been led down the garden path by Merrill Lynch," Kramer said. "As long as Harvard has access to the information, Merrill Lynch has no responsibility to provide the information. Who has the duty to call the [Securities Exchange Commission] and get that information?"

Kramer had hoped to derail the suit before it even began. He argued for dismissal on the grounds that the Harvard claim had not been specific enough in describing what the investment firm had done wrong.

In addition, Kramer argued that Lomas should also have been listed as a defendent in the case, since they provided Harvard with much of the information used to make the investment decision.

Judge Not Convinced

But Judge John J. McNaught apparently was not convinced, and he rejected the motion for dismissal a week after the hearing.

For now, lawyers on both sides are preparing for the next hearing, which will deal with the sharing of relevant documents between the two sides.

Merrill Lynch was "disappointed" with McNaught's decision, but Kramer said he still expects the proceedings will prove Merrill Lynch innocent of wrongdoing.

Renehan is also confident, although he is concerned about how willing Merrill Lynch will be in disclosing files relevant to the case.

"I may be wrong, but I think it will be a battle," Renehan said, adding that the documents will be an important part of the Harvard case. "We just want to get to the bottom of this."

But Harvard, at least, already has one minor victory under its belt.

"It's a good step forward," Renehan said. "Stage one is over."