Moore Stephens ruling due

Mr Justice Langley is set to rule tomorrow on the case, which has worried
auditors. Litigation funding has raised the prospect of countless companies with
grievances against former auditors, but no money, being able to sue
‘deep-pocket’ firms.

The firm, which made revenues last year of £107m, is defending itself against
a £90m negligence suit being brought by Benedict MacKenzie, the liquidators of
defunct company Stone & Rolls, a former Moore Stephens audit client.

Earlier this month, the judge heard deliberations from both sides, and
described the claimant seeking compound interest on its alleged losses as being
in ‘cloud cuckoo land’.

The claim is thought to be the first of its kind in the UK to be bankrolled
by litigation funding, a method by which a third party with no links to Stone
& Rolls provides the financial backing in return for a cut of the
prospective damages.

If Moore
efforts to get the compound interest claim thrown out succeed, that
would reduce the claim by almost half. The judgment will be heard tomorrow at
the Royal Courts of Justice.

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