United States Second Circuit

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Gould v. Winstar Communications, Inc., 10-4028

In a suit against an independent auditor of Winstar Communications, Inc., for securities fraud in violation of section 10(b) of the Securities Exchange Act, district court's grant of defendant's motion for summary judgment is vacated and remanded where: 1) a reasonable jury could determine that the audit was so deficient as to be "highly unreasonable, representing an extreme departure from the standards of ordinary care to the extent that the danger was either known to defendant or so obvious that defendant must have been aware of it"; 2) a jury reasonably could infer that plaintiffs' representative actually reviewed and relied on the relevant statements in the documents; and 3) a jury reasonably could find the requisite causal link between Winstar's alleged misconduct and the economic harm ultimately suffered by the plaintiffs.

Appellate Information

  • Decided 08/29/2012
  • Published 08/29/2012

Judges

  • Lohier

Court

  • United States Second Circuit

Counsel