Grant Thornton International
remains confident about results of Parmalat hearing

Grant Thornton International (GTI) said it remains very
confident of its position in its three-year legal case against
Parmalat in the US. The Italian dairy giant is pursuing a combined
amount of $10 billion in separate cases against GTI, the Bank of
America and Citigroup.

Judge Lewis Kaplan from the District Court for the Southern
District of New York is reviewing the case’s evidence and has yet
to decide whether it will proceed to trial. A court spokesperson
said there was no indication when an announcement might be made
about the case despite recent reports that Parmalat’s lawyers were
close to convincing US authorities to proceed.

Spokesperson Nan Williams said Grant Thornton is confident of its
position in the legal dispute: “We intend to defend that position
vigorously and at GTI we feel we will be fully exonerated in the
proceedings, should they go ahead. Some [other cases against GTI] have been dismissed so those that are left we are very confident
[about]. We believe we have a very strong case based on its
merits.” Williams said GTI was an umbrella organisation in which
all the individual member firms were separate financial and legal
entities in their own right. “GTI didn’t do any work for Parmalat
so the distinction between GTI and what was [going on with] the
member firm in Italy is a very important distinction in that they
are totally separate financial and legal entities,” she said.

Parmalat initiated proceedings against Grant Thornton and Deloitte
Global in 2004 after defaulting on more than €14 billion (then
worth $17.2 billion) in debt in the largest bankruptcy case in
European history. Since the original court documents were presented
in 2004, Deloitte Italy agreed to pay $149 million to Parmalat, its
former audit client, after reaching an out-of-court settlement in
January 2007.

Legal documents obtained by IAB this month outlined
Parmalat’s original allegations of professional malpractice in 2004
against Grant Thornton and Deloitte. Parmalat alleged that Grant
Thornton and its member firms played a crucial role in the theft
and disappearance of more than $14 billion and are liable for these
losses. The writ claimed that Grant Thornton members in the US,
Italy, Singapore, Venezuela, Brazil, Cayman Islands, Malta and the
Netherlands were involved in auditing Parmalat “and played an
integral part in the conduct, acts and omissions”. The case is
being pursued in the US since Parmalat alleged key parts of the
fraud occurred there.

Former Italian Grant Thornton auditors Lorenzo Penca and Maurizio
Bianchi were charged with securities-market manipulation in March
2004. In January 2004, GTI expelled its Italian member firm. In
July 2007, Judge Kaplan dismissed claims against Deloitte, Grant
Thornton and the networks’ US firms brought about by a legal team
representing Parmalat’s foreign investors. He ruled the charges
were not covered by US securities law.

Nicholas Moody