SUB-ITEM 77E:  Legal Proceedings

Morgan Stanley Technology Fund


Beginning October 25, 2002, purported class action complaints were filed in the
United States District Court for the Southern District of New York against
Morgan Stanley, the Fund (under its former name, the Morgan Stanley Information
Fund), Morgan Stanley Investment Advisors Inc., and certain subsidiaries of
Morgan Stanley alleging violations of certain federal securities laws in
connection with the underwriting and management of the Fund. These actions were
consolidated into one action in which plaintiffs allege, among other things,
that the prospectuses and registration statements for the Fund improperly failed
to disclose that research analysts employed by Morgan Stanley DW Inc. were
issuing overly optimistic stock recommendations to help Morgan Stanley obtain
investment banking business, and that certain of these reports concerned
companies in which the Fund was investing. A similar consolidated complaint was
filed with respect to the Fund formerly called the Morgan Stanley Technology
Fund, which merged with the Fund on October 6, 2003. Both consolidated
complaints were stayed pending a decision by the United States Court of Appeals
for the Second Circuit of an appeal from the dismissal of a very similar
complaint filed by plaintiffs against another mutual funds complex. The case
involving the other mutual funds complex recently settled. Plaintiffs filed a
Second Amended Consolidated Complaint against the Fund, Morgan Stanley
Investment Advisors Inc., and certain subsidiaries of Morgan Stanley, and also
filed a Second Amended Consolidated Complaint against the Fund formerly called
the Morgan Stanley Technology Fund, Morgan Stanley Investment Advisors Inc., and
certain subsidiaries of Morgan Stanley. The defendants have moved to dismiss
both Complaints. A decision on the motions to dismiss is pending.

The Fund and Morgan Stanley believe these lawsuits have no merit. However, the
ultimate outcome of these matters is not presently determinable and no provision
has been made in the Fund's financial statements for the effect, if any, of such
matters. The Investment Manager has agreed to indemnify the Fund against any
losses and claims associated with the complaint filed against the Fund formerly
called the Morgan Stanley Technology Fund.