Supreme Court of Texas

In investors' suit against financial auditing company for fraud, negligent misrepresentation and other claims, the judgment of the court of appeals is reversed in part where: 1) the particular investors in this case could not have justifiably relied on the audit reports as to the purchases made after they knew the corporation was at risk of financial ruin, and they may not substitute their escrow agent's reliance for their own without also being bound by its knowledge; and 2) in the absence of direct communication, the investors' "holder" claims, that they held securities when they otherwise would not have, is rejected.

Appellate Information

• Argued 12/09/2008
• Decided 07/02/2010
• Published 07/02/2010

Judges

Court

• Supreme Court of Texas

Counsel