Bernstein Liebhard provides contingency fee representation to businesses that have suffered substantial losses as result of professional negligence, known as malpractice. Professional malpractice is when a professional fails to act, comply, or adhere to the professional standards established by a particular industry. The professional can be a lawyer or an accountant (among others). Our firm has recovered millions of dollars for our clients from legal and accounting professionals.
Accounting malpractice occurs when an accounting professional has violated a reasonable standard of care in the accounting field. Some accounting areas in which a malpractice case is applicable are: failure to properly audit financial statements or detect defalcations, failure to provide correct tax advice, erroneous advice regarding accounting matters, and inventory errors, among others. For example, the firm represented the Actrade Liquidation Trust (the “Trust”), the successor to Actrade Financial Technologies, Ltd., a former publicly-traded company on NASDAQ, in two actions – one against Actrade Capital’s former Chairman of the Board of Directors related to his misappropriation from Actrade and his fraudulent inflation of Actrade Capital’s revenues; and the second against Deloitte & Touche LLP for auditing malpractice and/or negligence. The firm obtained a $3 million global settlemens of both actions.
Certified Public Accountants (CPAs) are also bound by a set of professional standards. CPAs must adhere to the regulations and guidelines of their industry, and a failure to meet such standards may add to the merit of a malpractice case. Such regulations also require CPAs to maintain a certain level of competence in the field, so as to maintain the highest quality of the services they provide. Finally, CPAs must maintain the highest degree of objectivity and independence, especially in offering auditing and attestation services, and avoid offering professional services where perceived or actual conflict of interest exists.
Attorney malpractice occurs when an attorney is negligent by failing to exercise “reasonable care.” This means that the lawyer failed to use a degree of skill that an ordinary member of the legal profession would use. Attorney malpractice includes the failure of the law firm or lawyer to properly handle a business transaction, lawsuit, tax advice, or some other matter.