An accountant has a duty in some circumstances to correct its certified opinion on a company's financial statement, the 2nd Circuit has ruled. Although the circuit has in past cases alluded to such a duty, it held "squarely" for the first time that such a duty exists and its violation "gives rise to primary liability under the securities laws." The holding reverses Southern District of New York Judge John Sprizzo, who had ruled that the plaintiffs had failed to plead a viable theory of primary liability.
March 01, 2007 at 12:00 AM
1 minute read
The original version of this story was published on Law.Com
An accountant has a duty in some circumstances to correct its certified opinion on a company’s financial statement, the 2nd U.S. Circuit Court of Appeals has ruled.
Although the circuit has in past cases alluded to such a duty, it held “squarely” for the first time that such a duty exists and its violation “gives rise to primary liability under the securities laws,” in Overton v. Todman & Co., 06-2496-cv.
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