Grant Thornton LLP and its international parent firm are striking back against a $10 billion lawsuit filed against them by bankrupt dairy giant Parmalat.
Following Parmalat's implosion, its chairman, Enrico Bondi, filed lawsuits in the United States against former outside auditors Grant Thornton and Deloitte Touche Tohmatsu and their U.S. and Italian affiliates, as well as Citigroup and Bank of America, seeking to recover damages stemming from its collapse.
Grant Thornton LLP and Grant Thornton International have each filed a motion in Chicago federal court seeking to dismiss the claims.
In a statement, Grant Thornton International said that it sought to dismiss Parmalat's claims "on the ground that it is a separate and independent company from Italaudit, previously known as Grant Thornton SpA, and Grant Thornton International is therefore not legally responsible for any wrongs alleged to have been committed by Italaudit."
"We did not issue any statements or audit opinions on Parmalat, and the legal theory being used in this suit has been overruled as a basis of liability in all similar cases in the U.S.," a spokesman for GT LLP said. "Grant Thornton LLP has no legal or regulatory exposure in this matter, as the structure of the worldwide organization is such that we do not share profits with, or any liability for the actions of, other member firms or former member firms such as Italaudit SpA, the former Italian member firm."
Grant Thornton International also filed a motion Thursday afternoon in New York federal court seeking to modify an anti-suit injunction obtained by Parmalat that prohibits creditors from suing it in the United States and from asserting rights of set-off or seeking discovery of information.
"Grant Thornton International is seeking the right to assert claims and seek discovery against Parmalat, on the ground that it would be unfair to allow Parmalat to sue in the United States but not to allow Grant Thornton International to assert its own claims and seek discovery against Parmalat," a spokeswoman for GTI said.
The lawsuit, filed in August in Illinois Circuit Court by Bondi, who became chairman of Parmalat in December 2003 after it became insolvent, alleges that the auditors overlooked fraud and looting that nearly led to the company's downfall.
The insolvent dairy firm's unraveling began in December 2003, when it was discovered that a bank account of Parmalat subsidiary Bonlat Financing that was said to have $4.9 billion didn't exist. An audit ordered after the scandal broke put the company's debt at about $18 billion -- eight times more than Parmalat claimed months earlier.
In January, GTI expelled its Italian member firm, formerly Grant Thornton SpA, now known as Italaudit SpA.
