The Rigas family made good on its promise to try to block former Adelphia Communications accountants Deloitte & Touche from moving a suit brought against the family to a New York federal court.
On Aug. 28 the Rigases filed a petition in the Philadelphia court of Common Pleas, Commerce Court Division, to strike the attempted discontinuance of a suit Deloitte brought against the family in 2003.
Deloitte sued the Rigases in 2003 in Philadelphia alleging fraud and negligent misrepresentation stemming from the accounting scandal that rocked the former cable operator in 2002. According to the Rigases, a judge in the Philadelphia action previously dismissed the negligent misrepresentation claim against the family.
Two of the Deloitte claims – for fraud and contribution, basically claiming that the Rigas family is liable to “contribute” all or part of the $433 million in settlements Deloitte has had to pay as a result of its relationship with Adelphia – were scheduled for jury selection on Sept. 7, with a trial slated for Sept. 10.
Former Adelphia chairman John Rigas and his son former chief financial officer Timothy Rigas were convicted in 2004 on 18 counts of fraud and conspiracy related to the accounting scandal. Timothy Rigas was sentenced to 20 years in prison and John Rigas was sentenced to 15 years. Both men reported to Butner Federal Correctional Institute in North Carolina earlier this month to begin serving out their sentences.
Lawrence McMichael, an attorney for the Rigas family, had said that Pennsylvania law prohibits a party from dropping claims against a defendant after extensive litigation while reserving the right to re-litigate the same claims in another court. McMichael also stated in the past that the New York suit is actually an amalgamation of about 50 cases related to Adelphia, which hasn’t been acted on in years.
In a statement, former Adelphia executive James Rigas – who was never charged with any crime – said that the family is anxiously awaiting its day in court.
“The Rigas family will continue to pursue our right to a full trial on Deloitte’s claims so that a public record can be made of what really happened at Adelphia,” Rigas said in the statement. “Contrary to Deloitte’s persistent public statements, Deloitte auditors possessed all the information they needed to perform thorough and accurate audits. At no time did any of the Rigases withhold information from Deloitte or instruct any Adelphia employee to do so. At no time did any of the Rigases participate in a fraud directed at Deloitte or anyone else. The evidence shows this clearly.”