Accountants’ Liability   

We help accounting firms and their professionals evaluate and mitigate risks, defend against claims from clients and third parties, and respond to inquiries and enforcement actions from regulators. As we tell our clients’ stories, we know the importance of describing the scope and limitations on the work that accountants provide (and do not provide) and the context in which they interact with clients and third parties as they perform their services.

Our services include defending accountants in:

• Securities class actions
• Trustee Litigation
• Lender Suits
• Client claims
• PCAOB & Securities and Exchange Commission investigations
• State Boards of Accountancy Proceedings

Representative Matters

• Successfully defending an accounting firm in a securities class action brought by investors based on public offerings of common stock
• Representing an accounting firm partner in litigation by a former firm client who claims to have invested, at the recommendation of the partner, in funds where the fund manager has admitted to committing investor fraud
• Defending an accounting firm and partner in a PCAOB enforcement action related to an audit of a broker-dealer
• Representing an individual audit partner in an SEC enforcement action related to an audit of a public company involved in commodities trading
• Representing accountants in state board of accountancy matters in Pennsylvania, New York, and New Jersey
• Representing a Big 4 accounting firm in an action brought in the S.D.N.Y. by the Liquidating Trustee of a specialty finance company seeking in excess of $300 million related to claims for professional malpractice, breach of contract, negligent misrepresentation, fraud, aiding and abetting fraud, aiding and abetting breach of fiduciary duty and deepening insolvency. The fraud, aiding and abetting, and deepening insolvency claims were dismissed at the motion to dismiss stage. Summary judgment was granted on all remaining claims. The Second Circuit affirmed.
• Representing a Top 20 accounting firm in a Madoff-related suit in the S.D.N.Y. brought by limited partners in a sub-feeder fund. The motion to dismiss was granted on all claims.
• Representing a Big 4 accounting firm in litigation in Dauphin County Court of Common Pleas, Pa., brought by a limited partner in a real estate limited partnership who alleged fraud. The motion to dismiss was granted on all claims.
• Representing a Big 4 accounting firm in a fraud suit filed in the Philadelphia Court of Common Pleas, Pa., by the purchaser of an entity for whom the firm had performed due diligence services. Plaintiff claimed that the accounting firm had made fraudulent misrepresentations in its report and in discussions that helped the majority shareholders fraudulently obscure the acquisition company’s true financial condition. All claims were dismissed.
• Representing a Top 20 accounting firm in the Chester County Court of Common Pleas, Pa., in a lawsuit brought by a non- profit client over the theft of funds by an employee of the non-profit over a three-year period. All claims were dismissed.
• Representing a Big 4 accounting firm in a series of consolidated securities class actions in the E.D.Pa. that claimed the accounting firm committed securities violations during its audits of an international manufacturer. All claims were dismissed on the grounds of international comity.
• Representing a Top 20 accounting firm in a case brought in New York County Supreme Court by a bank client and certain of its shareholders, who alleged negligence and gross negligence. After the court granted defendants’ initial motion to dismiss in its entirety, plaintiffs filed an amended complaint. The trial court dismissed two of the three new claims brought by plaintiffs, including the entirety of the shareholders’ claim. The sole remaining claim was settled on favorable terms at mediation required under the terms of the engagement letter.