Supreme Court Decision on Third Party Liability

Source: CPA Trendlines

The U.S. Supreme Court ruled that third parties are not liable to investors who sustained losses from fraud unless the third party had direct responsibility for the investor’s reliance on fraudulent financial information.

The case involved Stoneridge Investment Partners, which brought suit against Scientific Atlanta and Motorola Inc. saying they helped Charter Communications Inc. inflate revenues. The defendants did business with Charter Communications but did not make any misstatements and had no involvement in Charter’s misstatement of its financial reports.

The AICPA filed an amicus brief in the case.

For the complete article, click here and read AICPA Hails Supreme Court Decision in the January 15, 2008, posting.

From CPA Trendlines, posted January 14, 2008, http://cpatrendlines.com.

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