Analysis Group Helps Ernst & Young Achieve Victory in Rare Trial of Securities Fraud Case.BOSTON -- In only the third trial of its nature to go to a verdict in the last decade, Analysis Group's client, auditor Ernst & Young, was found to have no liability and was not responsible for any damages in the securities fraud suit against Clarent Corporation in which E&Y was named a co-defendant. Analysis Group was retained by Latham & Watkins on behalf of Ernst & Young in the case, which involved accounting irregularities at Clarent. Clarent shareholders filed a class action accusing the company of overstating revenues, claiming that Ernst & Young was liable for securities fraud in violation of Section 10-b-5 of the Securities Exchange Act of 1934, and requesting approximately $125 million in damages. At issue was how much of Clarent's stock price decline during the class period could be attributed to any accounting misstatements, and thus could be used to measure damages. "While trials of this particular kind are rare, outcomes can be significantly influenced by experts," said Bruce Deal, a Managing Principal of Analysis Group. "A successful outcome in any securities class action proceeding depends on expertise in developing sophisticated counter-arguments to plaintiffs' damages estimates." Analysis Group consulted on damages and causation causation Relation that holds between two temporally simultaneous or successive events when the first event (the cause) brings about the other (the effect). According to David Hume, when we say of two types of object or event that “X causes Y” (e.g. issues and provided expert testimony Testimony about a scientific, technical, or professional issue given by a person qualified to testify because of familiarity with the subject or special training in the field. on damages issues, working with E&Y in-house counsel Robert Cohen Robert Cohen may refer to:
With steep declines in Clarent's stock price during the class period, plaintiffs' expert contended that the fraud accounted for up to $8 in overpricing per share when the stock was trading at prices of $10-12, resulting in the $125 million calculation. Analysis Group Managing Principal Robert Sherwin, Ernst & Young's damages expert, calculated the maximum overpricing to be $1.92 a share. Mr. Sherwin's calculations were based on the final stock price drop when the accounting restatements were announced. When the case went to the jury, Ernst & Young was found to be without liability and the jury awarded no damages to the plaintiffs. About Analysis Group Analysis Group, Inc. (www.analysisgroup.com) provides economic, financial, and business strategy consulting to law firms This list of the world's largest law firms by revenue is taken from The Lawyer and The American Lawyer and is ordered by 2006 revenue:[1]
1 Residential city (1990 pop. 28,040), San Mateo co., W Calif.; inc. 1874. Electronic equipment and aerospace products are manufactured in the city. Menlo College and a Stanford Univ. research institute are there. 2 Uninc. , New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden , Washington, DC, and Montreal, Canada. |
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