Newman stays cool after BDO victory

Jeremy Newman has warned that the battle may not be over for BDO International, after a landmark decision ruled it out of being partly liable for a $521m (£321m) negligence case hanging over US network member BDO Seidman .

The BDO network chief executive said he was ‘relieved’ the US courts agreed International did not control Seidman, but Newman warned those lodging claims would not be deterred easily.

Newman said he had always been confident that BDO International’s arms-length approach would be proved but added: ‘There is still the risk of a further appeal, as well as the appeal by the US firm.’

BDO International was cleared last week at the Circuit Court of Florida, but cases still hang over other networks including Deloitte, KPMG and Grant Thornton.

BDO Seidman is still appealing against damages amounting to $521m for its audit of factoring company Bankest, owned by Banco Espirito Santo.

One senior figure said the decision would give firms a boost. ‘There will be differences in structure between every network, but the belief is, the way the other firms are arranged gives them an even better defence against similar claims.’

Banco’s lawyers said no decision had been made on an appeal.