audited financial U.S. Dist. Lexis 6444 (United States District Court for chapter? H. Rosenblum, Inc. v. Adler, 461 A.2d 138 , statements (864) the District of Maryland) 1983 N.J. Lexis 2717 (Supreme Court of New Jersey) iform Securities 51.3 Accountant's Liability to Third Party Giant 51.4 Ultramares Doctrine Texscan Corporation (TexsAct (873) Stores Corporation (Giant) hired Touche Ross \& Co. can) was a corporation located in Phoenix, Arizona. qualified opinion (Touche), a national CPA firm, to conduct audits of the The company was audited by Coopers \& Lybrand (863) company's financial statements for 2 years. Touche (Coopers), a national CPA firm that prepared audited rk product gave an unqualified opinion for both years. Touche was financial statements for the company. The Lindmmunity (875) unaware of any specific use of the audited statements ner Fund, Inc., and the Lindner Dividend Fund, Inc. by Giant. After receiving copies of these audited finan- (Lindner Funds), were mutual funds that invested in cial statements from Giant, Harry and Barry Rosenblum securities of companies. After receiving and reviewing (Rosenblums) sold their retail catalog showroom business the audited financial statements of Texsean, Lindner to Giant in exchange for 80,000 shares of Giant stock. Funds purchased securities in the company. ThereafOne year later, a major fraud was uncovered at Giant ter, Texsean suffered financial difficulties, and Lindner that caused its bankruptey. Because of the bankruptey, Funds suffered substantial losses on its investment. the stock that the Rosenblums received became worth- Lindner Funds sued Coopers, alleging that Coopers was less. In conducting Giant's audits, Touche had failed negligent in conducting the audit and preparing Texsto uncover that Giant did not own certain assets that can's financial statements. Can Coopers be held liable appeared on its financial statements and that Giant had to Lindner Funds for accounting malpractice unde omitted substantial amounts of accounts payable from the Ultramares doctrine, Section 552 of the Restate its records. The Rosenblums sued Touche for accounting ment (Second) of Torts, or the foreseeability standard malpractice. Is Touche liable for accounting malpractice Lindner Fund v. Abney, 770 S.W.2d 437, 1989 Mo. Aps under any of the 3 negligence theories discussed in this Lexis 490 (Court of Appeals of Missouri) misrepresentation money lost by the he audit report pre- .

1. audited financial U.S. Dist. Lexis 6444 (United States District Court for chapter? H. Rosenblum,
Inc. v. Adler, 461 A.2d 138 , statements (864) the District of Maryland) 1983 N.J. Lexis 2717
(Supreme Court of New Jersey) iform Securities 51.3 Accountant's Liability to Third Party Giant
51.4 Ultramares Doctrine Texscan Corporation (TexsAct (873) Stores Corporation (Giant) hired
Touche Ross & Co. can) was a corporation located in Phoenix, Arizona. qualified opinion
(Touche), a national CPA firm, to conduct audits of the The company was audited by Coopers &
Lybrand (863) company's financial statements for 2 years. Touche (Coopers), a national CPA
firm that prepared audited rk product gave an unqualified opinion for both years. Touche was
financial statements for the company. The Lindmmunity (875) unaware of any specific use of the
audited statements ner Fund, Inc., and the Lindner Dividend Fund, Inc. by Giant. After receiving
copies of these audited finan- (Lindner Funds), were mutual funds that invested in cial
statements from Giant, Harry and Barry Rosenblum securities of companies. After receiving and
reviewing (Rosenblums) sold their retail catalog showroom business the audited financial
statements of Texsean, Lindner to Giant in exchange for 80,000 shares of Giant stock. Funds
purchased securities in the company. ThereafOne year later, a major fraud was uncovered at
Giant ter, Texsean suffered financial difficulties, and Lindner that caused its bankruptey.
Because of the bankruptey, Funds suffered substantial losses on its investment. the stock that the
Rosenblums received became worth- Lindner Funds sued Coopers, alleging that Coopers was
less. In conducting Giant's audits, Touche had failed negligent in conducting the audit and
preparing Texsto uncover that Giant did not own certain assets that can's financial statements.
Can Coopers be held liable appeared on its financial statements and that Giant had to Lindner
Funds for accounting malpractice unde omitted substantial amounts of accounts payable from the
Ultramares doctrine, Section 552 of the Restate its records. The Rosenblums sued Touche for
accounting ment (Second) of Torts, or the foreseeability standard malpractice. Is Touche liable
for accounting malpractice Lindner Fund v. Abney, 770 S.W.2d 437, 1989 Mo. Aps under any of
the 3 negligence theories discussed in this Lexis 490 (Court of Appeals of Missouri)
misrepresentation money lost by the he audit report pre-