One month ago, US District Judge Lewis Kaplan sent a shock wave through the auditing world by ruling that a securities class action could proceed against Deloitte & Touche Tohmatsu and Deloitte & Touche LLP for the actions of Deloitte & Touche SpA, which served as Parmalat’s auditor in Italy. The two Deloitte entities argued that they did not have control over Deloitte Italy, but Judge Kaplan held that this issue was one that would have to be decided at trial.
On Wednesday of this week, Judge Kaplan once again ruled against an auditing firm in the Parmalat case, denying the motions for summary judgment of Grant Thornton International (GTI) and Grant Thornton LLP (GT US). Similar to the case against Deloitte, plaintiffs’ claims against GTI and GT US rested on the premise that those defendants were vicariously liable for the alleged fraud of GT Italy, one of Parmalat’s former auditors. Looking closely at the facts concerning GTI and GT US’ control over GT Italy, however, Judge Kaplan found that
