Davis Polk Ends Decade-Long Securities Fraud Battle for Deloitte
On Friday, June 15, 2012, Davis Polk won a significant victory on behalf of Deloitte & Touche LLP in the Alabama Supreme Court with an affirmance of the dismissal of a securities-fraud lawsuit arising out of the 1995 leveraged recapitalization of the Bruno’s regional supermarket chain. This brings to a close 12 years of litigation brought in two states by renowned trial lawyer Leo Beus via three separate actions, each of which Davis Polk had dismissed in turn.
After Bruno’s filed for bankruptcy, institutional investors sued Deloitte, which had done due diligence for the investment firm acquiring Bruno’s, in Alabama through their common investment adviser. After Davis Polk successfully won dismissal of that action (as affirmed by the Alabama Supreme Court), the plaintiffs renewed their claims against Deloitte, again in Alabama state court, this time suing as individuals. After Davis Polk successfully won dismissal of that action, the plaintiffs brought a substantively identical suit against Deloitte in New Jersey. After Davis Polk successfully won dismissal of that action (as affirmed on appeal), the plaintiffs tried to again press their luck against Deloitte as part of the second Alabama action (which was ongoing as to other defendants). After the Alabama trial court afforded finality to Deloitte’s earlier dismissal, the plaintiffs appealed. Last week, the Alabama Supreme Court affirmed the trial court’s dismissal without opinion or dissent, finally bringing the Bruno’s litigation against Deloitte to a close.
The current Davis Polk team included partner Frances E. Bivens, senior counsel Daniel F. Kolb, counsel Gina Caruso, and associates Anna Thea Bridge, David C. Newman and Katherine A. Marshall. All members of the Davis Polk team are based in the New York office.