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three theories of fraud) and the drop in stock. Indeed, there is no connection between

the text of the press releases and the theories of fraud. As such, the CAC does not

adequately plead loss causation.

B. The Auditor Defendant’s Motion

The Auditor Defendant makes the same arguments in favor of dismissal as the

Whitney Defendants, i.e. the CAC does not adequately plead scienter or loss causation.

The Auditor Defendant also argues that the CAC fails on a more general level of

pleading as to them because it is virtually devoid of any detail as to its alleged


The Auditor Defendant is mentioned sparingly throughout the CAC. It is named

in ¶ 13-16, 78, 82 and 114. The allegations against the Auditor Defendant essentially

boil down to the fact that (1) the Auditor Defendant was the auditor for the Company (¶

13); (2) it was paid for its services (¶ 13); (3) it issued opinions on the Company’s

financial statements (¶¶ 13 and 82); (4) it provided unspecified letters of consent or

made unspecified “representations regarding the accuracy and completeness of filings

made by the Company with the SEC (¶ 14); (5) at some point the Auditor Defendant

reported certain weaknesses to Whitney’s board (¶ 78); (6) that the Auditor Defendant

had access to unspecified documents that allegedly showed the public statements were

false (¶ 15); (7) that the Auditor Defendant knew or disregarded these facts (¶ 16); (8)

the Auditor Defendant is liable to plaintiff (¶ 114). These allegations do not plead a

claim for securities fraud against the Auditor Defendant.

First, plaintiff fails to provide what would be the expected minimum allegations

against the Auditor Defendant. Plaintiff does not allege a single GAAP violation or other


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