Case Against Credit Suisse Tossed Over Flawed Expert Witness Report
According to a recent article in Bloomberg Businessweek, U.S. District Judge Nathaniel Gorton rejected a class-action complaint against Credit Suisse due to a flawed study by the plaintiff’s expert witness. The case, which was set to go to trial in March, was brought by individuals and a pension fund that alleged Credit Suisse issued misleading reports about AOL Time Warner. The reports purportedly included unattainable financial projections that deceived investors into buying AOL Time Warner stock.
In a January 13 ruling, Judge Gorton found expert witness, Scott Hakala, failure to
“isolate the effect of defendants’ alleged fraud from other industry- and company-specific news reported on event days confounds his event study and renders it unreliable.”
The dismissal is just another notable story-line in a saga that started over 10 years ago when the Securities and Exchange Commission began investing AOL’s accounting practices such as booking stock rights and bartered computer equipment as ad revenue.
Forensic accounting expert witnesses and fraud investigators should be sure to check out the case “Credit Suisse-AOL Securities Litigation, 02-12146, U.S. District Court, District of Massachusetts (Boston)” or read the complete Bloomberg Businessweek article.