Close X
Attorney Spotlight

How did an interest in healthcare policy lead Robert Platt to a career in the law? Find out more>

Search

Close X

Experience

Search our Experience

Experience Spotlight

Envision to Sell to KKR for $9.9 Billion

We represented Envision Healthcare Corporation (NYSE: EVHC) in its definitive agreement to sell to KKR in an all-cash transaction for $9.9 billion, including debt. KKR will pay $46 per Envision share in cash to buy the company, marking a 32 percent premium to the company's volume-weighted average share price from November 1, when Envision announced it was considering its options. The transaction is expected to close the fourth quarter of 2018. Read more


Envision Healthcare

Close X

Thought Leadership

Enter your search terms in the relevant box(es) below to search for specific Thought Leadership.
To see a recent listing of Thought Leadership, click the blue Search button below.

Thought Leadership Spotlight

Six Things to Know Before Buying a Physician Practice spotlight

Dermatology, ophthalmology, radiology, urology…the list goes on. Yet, in any physician practice management transaction, there are six key considerations that apply and, if not carefully managed, can derail a transaction. Download the 6 Things to Know Before Buying a Physician Practice to keep your physician practice management transactions on track.

Click here to download the guide.

Chris Lazarini Analyzes Daubert in Securities Fraud Case

Securities Litigation Commentator

Publications

June 20, 2016

Bass, Berry & Sims attorney Chris Lazarini analyzed a case in which the court applied Daubert to strike the testimony of an expert witness because the expert was not qualified as an expert in that specific area and her testimony would only confuse jurors.

Chris provided the analysis for Securities Litigation Commentator (SLC). The full text of the analysis is below and used with permission from the publication. If you would like to receive additional content from the SLC, please visit the SLC website to sign up for the newsletter.

Puda Coal Securities Inc. Litigation, In Re: Querub vs. Moore Stephens Hong Kong, No. 15-2100 (2nd Cir., 5/20/16) 

Under the Daubert standard, an expert must be qualified to testify as to a certain issue and her opinion on that issue must be informed by reliable information and methodology and must not be substantially outweighed by the danger of confusing the issues or misleading the jury. 

Plaintiffs are shareholders of Puda Coal, Inc. ("Puda"), a China-based company once traded on the New York Stock Exchange. Puda held, as its sole asset, a 90% stake in Shanxi Coal ("Shanxi"), a China-based coal supplier. In 2009, Puda's chairman transferred Puda's entire stake in Shanxi to himself, leaving Puda a shell company. Puda's 2009 and 2010 financial statements continued to reflect Shanxi's revenue, net income, and other financial information. Defendant, a Hong Kong-based audit firm, issued "clean" audit opinions for Puda's 2009 and 2010 financial statements, purportedly pursuant to Public Company Accounting Oversight Board ("PCAOB") standards. After the Shanxi transfer became public in 2012, Puda's shares collapsed and the company was delisted. At the same time, Defendant resigned as Puda's auditor and announced that its 2009 and 2010 audit opinions could no longer be relied upon. 

Plaintiffs sued, alleging that Defendant violated Section 11 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934. Opposing Defendant's motion for summary judgment, Plaintiffs relied on their expert, who testified that Defendant failed to comply with the auditing standards of Hong Kong and the People's Republic of China ("PRC"). Plaintiffs' expert admitted, however, that she was not an expert on PCAOB and could not opine on whether the audits complied with PCAOB standards. Defendant offered a contra-expert who was qualified to discuss PCAOB standards and opined that the audits fully complied with them. The district court found that Plaintiff's expert did not have expertise in PCAOB audits, struck her testimony, and awarded summary judgment to Defendant. 

The Court reviews the exclusion of expert testimony under the abuse of discretion standard. Applying the Supreme Court's teachings in Daubert v. Merrell Dow Pharmaceuticals, the Court finds that the district court appropriately struck the testimony of Plaintiffs' expert, because she was not qualified on PCAOB, the sole relevant auditing standard, and because allowing her opinions on Hong Kong and PRC audit standards would not aid the jury and risked confusing the issues. The Court also finds that Plaintiffs did not raise triable issues of fact under §10(b) or §11. As to §10(b), the core of the complaint alleges "fraud by hindsight," which is inadequate to support the claim. Similarly, Plaintiffs cannot support their §11 claims, due to a lack of evidence that Defendant did not believe its "clean" audit opinion and that Defendant omitted material facts about the basis for its opinions. The Court affirms summary judgment for Defendant. 

Among the defendants still in the case are two underwriters of a 2010 public stock offering by Puda.


Related Professionals

Related Services

Notice

Visiting, or interacting with, this website does not constitute an attorney-client relationship. Although we are always interested in hearing from visitors to our website, we cannot accept representation on a new matter from either existing clients or new clients until we know that we do not have a conflict of interest that would prevent us from doing so. Therefore, please do not send us any information about any new matter that may involve a potential legal representation until we have confirmed that a conflict of interest does not exist and we have expressly agreed in writing to the representation. Until there is such an agreement, we will not be deemed to have given you any advice, any information you send may not be deemed privileged and confidential, and we may be able to represent adverse parties.