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Two recent Southern District of New York summary judgment decisions in the In re Parmalat Securities Litigation1 are of potential concern to large global accounting firms that may have found comfort in the Supreme Court’s Stone­ridge Investment Partners, LLC v. Scientific-Atlanta, Inc. decision last year. Where a foreign affiliate’s conduct creates potential liability, courts have rarely allowed claims to extend to the organization’s global umbrella entity or its U.S. operating entity.2 The new Parmalat decisions, however, allowed securities claims to proceed to trial against both Deloitte & Touche’s and Grant Thornton’s international and U.S. entities under §20(a) of the Securities Exchange Act of 1934. Both decisions also upheld claims against these entities under §10(b) of the act by invoking common law agency principles, notwithstanding the Supreme Court’s Stoneridge decision, which set forth no such exception to the rules for establishing primary liability.

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