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1
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SUPPLMNTAL CMPLT
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EXTRACTED KEY WORDS
DEFENDANTS PLAINTIFFS ASSISTANCE SILVER HEILBRUN LEE ACCOUNTING YORK AUDITING CERTIFICATION REPORTS AMOUNT RISKS PAID CONTRACT PARAGRAPH INTERNATIONA1 CREDIT OBLIGATIONS DEMAND NOTES RELIANCE NORTH AMERICA CITIBANK PECUNIARY INJURY FRI-ANDERSEN UNDERTOOK SUBSIDIARIES AFFILIATES ACCOUNTING STANDARDS PRACTICES |
ALVIN DWORMAN, BURTON I. ROFFMAN
and THRIFT CREDIT CORPORATION,
-against-
T
ARTHUR ANDERSEN & CO., GEMLD LEE,
No.
MERWN SILVER and JOSEPH W. HEILBRUN,'
80
-1---------*----------11-----------x
'-tiTERED IN 'DM
EHTFRFP It4 DXK
The plaintiffs,
JUN 6 198i
Robert Kasanaf S Bart M. Schwartz,
Alleqations Relevant
`" -, 1. The
a resident of the City,
York.
:- ., y . . . `..,:.`: >... `- -:. `. 2.L The
is a resident of the City
of Broome in the State of New York.
3. The
, is
the
ff
:ipal
igitemp
un. organized
a who. : of New
and State
a ,.*., -. - -- *
gitemp filed,a petition
pur-
suant to Chapter XI of the Bankruptcy Act in
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2
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STIP & ORDER
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EXTRACTED KEY WORDS
SUPREME COURT YORK COUNTY PREJUDICE |
SUPREME COURT OF THE STATE OF NEW YORK
NEW YORK COUNTY: PART 49
-----1-------------------------- X
AXEL JOHNSON INC., : Index
(Justice
Plaintiff, :
- against - :
ARTHUR ANDERSEN & CO., INC., :
Defendant. :
--------------------------------x
IT IS HEREBY STIPULATED AND AGREED by and between the
undersigned attorneys for plaintiff Axe1 Johnson
and defendant Arthur Andersen & Co., Inc.
follows:
1. This action shall be stayed
to dismissal or further proceedings in accordance
of this Stipulation and Order.
2. Except as provided in paragraphs
this action shall be dismissed in its entirety
any one of the following occurs: (a) the action
Johnson Inc. v. Arthur Andersen & Co.. Inc.,
now pending in the United States District
District of New York (the "Federal Actiont')
which is affirmed on appeal or the time to appeal has expired,
including the time to petition for certiorari
States Supreme Court (regardless of outcome on the
liability and/or damages); (b) the Federal
any time; or (c) the Federal Action is dismissed
Any reference in this Stipulation and Order to dismissal
Federal Action or any claim contained therein
dismissal was affirmed on appeal or the time to appeal has
expired, including the time to petition for certiorari
United States Supreme Court.
3. In the event that the Federal
in its entirety by reason of dismissal of Johnson's
Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C.
L W(b), and Rule lob-5 promulgated thereunder,
§ 240.10b-5 (the "lob-5 claim"), solely on the basis
more of the following: (a) the statute of limitation;
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3
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LAUER AFFDVT
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EXTRACTED KEY WORDS
EXHIBIT COURT YORK DISMISS JOHNSON LAW MOTION SUPPORT AXE1 JOHNSON ACCOMPANYING MEMORANDUM DISTRICT COURT COUNTY PLAINTIFF DEFENDANT SWORN THIRD CLAIMS CIV MEL APPEALS REVIEW INDUSTRY AUDIT GUIDE DIRECTORS IT1 HOLDING MANAGEMENT ACCOUNTANTS AICPA GUIDE IT1 HOLDING CORPORATION |
l l
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
--------------------_____I___________ X
AXEL JOHNSON INC., : Index No. 30458/91
Plaintiff, : IAS Part
- against - :
ARTHUR ANDERSEN & CO., : AFFIDAVIT OF ELIOT LAUER
Defendant. :
STATE OF NEW YORK ) ss. :
COUNTY OF NEW YORK;
ELIOT LAUER, being duly sworn deposes and says:
1 . I am a member of the law firm of Curtis, Mallet-
Prevost, Colt & Mosle, attorneys for defendant Arthur Andersen &
Co. ("Andersenl') . I submit this affidavit in support of
Andersen's motion to dismiss the First, Second and Third Claims
of the complaint of plaintiff Axe1 Johnson Inc. (I~Johnsonl~), and
in order to place before the Court the complaint and other
documents referred to in the accompanying memorandum of law
submitted by Andersen in support of its motion to dismiss.
2. Attached as Exhibit A is a copy of the summons and
complaint in this action.
3. Attached as Exhibit B is a copy of the complaint,
dated September 28, 1989, filed by Johnson in the United States
District Court for the Southern District of New York, Axe1
Johnson Inc. v. Arthur Andersen & Co., 89 Civ. 6490 (MEL)
(S.D.N.Y.).
l a
4. Attached as Exhibit C is a copy of the order of
the District Court dismissing the complaint in Axe1 Johnson Inc.
v. Arthur Andersen & Co., 89 Civ. 6490 (MEL) (S.D.N.Y. Oct. 11,
1991).
5. Attached as Exhibit D is a copy of the complaint
which was the subject of the Court of Appeals' review in Credit
Alliance Corp. v. Arthur Andersen & Co., 65 N.Y.2d 536, 499
N.Y.S.2d 435 (1985).
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5
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DEF MEMO IN SUPP TO DSMSS
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EXTRACTED KEY WORDS
COMPLAINT LAW COURT NEGLIGENCE ALLEGATIONS MOTION LIMITATIONS EXHIBIT YORK LAUER JOHNSON AFFIDAVIT INSUFFICIENT STATUTE MATTER IT1 DEFENDANT MALPRACTICE CPLR THIRD CLAIMS DISTRICT COURT MEMORANDUM CONCLUSORY ALLEGATIONS APPLICABLE STATUTES STANDARDS COMMON LAW ASSIGNEE CLAIM SUPREME COURT PLEAD FRAUD |
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
- - e - - 1 - - - - - - - - - - - - X
AXEL JOHNSON INC., : Index No. 30458/91
Plaintiff, :
- against - :
ARTHUR ANDERSEN & CO., :
Defendant. :
--1--------------c
-X
MEMORANDUM OF LAW OF DEFENDANT
ARTHUR ANDERSEN & CO. IN
SUPPORT OF ITS MOTION TO DISMIBS
Defendant Arthur Andersen C Co. (l'Andersenl') submits
this memorandum of law in support of its motion pursuant to CPLR
3211(a)(5) and (7) and CPLR 3016(b) for an Order dismissing the
First, Second and Third Claims of the complaint.' The First
Claim is insufficient as a matter of law because it fails to
state a cause of action for fraud and fails to plead fraud with
the particularity required by CPLR 3016(b). Put simply, the
First Claim is a negligence claim with the addition of conclusory
allegations of fraud.
The Second and Third Claims are barred by the
applicable statutes of limitation.
1 A copy of the complaint in this action (the l'ComplaintVV) is
annexed as Exhibit A to the Affidavit of Eliot Lauer, sworn to on
November 21, 1991, and submitted together with this memorandum of
law in support of Andersenls motion to dismiss (hereinafter,
"Lauer Aff.@l I-
*
\q-
PROCEDURAL BACKGROUND
+ A. The Parties
Andersen is a worldwide tax and accounting firm that
*
performs audits, reviews and other services for its clients. On
various occasions prior to September 20, 1985, Andersen's
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6
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STATMNT CMPLT DSMSSD
|
EXTRACTED KEY WORDS
BASIS COURT MOOT |
a a l a
J
C r
I
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
--_---_-------1--
AXEL JOHNSON INC., i
Plaintiff,
-against-
ARTHUR ANDERSEN 6: CO.,
Defendant.
-_------c--I-----
LASKER, D.J.
On October 7, 1991 the Court
Circuit decided, in Welch, et al.
Docket No. 90-7419, that the
in
Lampf, et al. v. Gilbertson, 111
B. Beam Distillins Co. v. Georoia,
to be applied retroactively.
t
in actions brought under 15 U.S.C.
the Securities and Exchange Act
of
limitations was one year. The
Supreme Court and Court of Appeals
complaint in this case time barred.
3. . claim must be dismissed.
The defendants have
jurisdiction of the state claim contained
nd
of a claim for common law fraud which they have
to the complaint. Under the rationale
1
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7
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COMPLAINT
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EXTRACTED KEY WORDS
COUNTY SUPREME COURT YORE GUIDE BASIS PAID STOCK PURCHASE SHARES REPORTING DEEM PROPER |
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
'----'-'-'-'--'-"'----------------x
:
AXEL JOHNSON INC., :
- against - . . COMPLAINT
:
ARTHUR ANDERSEN & CO., : JURY TRIAL
:
Defendant. :
'--'-'-'-"--"-'-'----------------x
Plaintiff, by its undersigned attorneys,
following allegations for its complaint.
Parties
1. Plaintiff, Axe1 Johnson Inc.,
A. Johnson & Co., Inc. (I'Johnsonl'), is a Delaware
its principal place of business in New York, New York.
in lines of business in energy, electronics,
products.
2. Johnson asserts some claims in
assignee of Industrial Tectonics, Inc. ("ITI").
IT1 in December 1982 and has maintained IT1 as a
incorporated wholly owned subsidiary since that
operations were divided into a ball division
Dexter, Michigan, which produces precision-ground
and specialty parts, particularly for automotive
applications; and a bearing division with
Dominguez California, which produces high
particularly for defense, aerospace, and advanced
applications. The bearing division has been sold.
3. Defendant Arthur Andersen
I'Andersen") is a partnership that performs
accounting services. AA maintains offices
Johnson relied on audit and other reports
made
by AA in connection with Johnson's purchase
of ITI's business.
Facts
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