Professional Misconduct

Litigation Engagements

• On behalf of defendant – a Big Four international accounting firm – I presented a deposition as a fact witness in a lawsuit for professional malpractice filed by a former client over his investment in an allegedly abusive tax shelter transaction based on my previous representation of this firm as an expert on standards of care in federal tax practice and alleged economic damages issues in 14 similar lawsuits – in state court in Georgia.

• On behalf of defendant – a CPA tax preparer – who was sued by a former client for allegedly conspiring with her business partner to keep her from discovering his purported fraudulent acts by preparing allegedly incorrect and deceptive income tax returns – in state district court in Texas.

• On behalf of defendant – a CPA firm and several of its partners, one of whom is also a Certified Financial Planner - who were sued by several former related-party clients regarding their alleged efforts to replace the existing investment advisor and for supposedly giving inappropriate investment advice at or about the time of the beginning of the Great Recession in early 2009 – in federal district court in Texas.

• On behalf of defendants – a law firm, the estate of its deceased owner, and one of its attorneys – who were sued by a class of clients the firm represented in mass tort litigation involving alleged silica-related injuries who alleged the firm incurred unnecessary and excessive general expenses not related to any specific person’s case that it improperly recovered from them by charging them 3% of their settlement amounts over and above expenses that were specifically identifiable to their individual cases – in state probate court in Texas.

• On behalf of defendants –a financial planning firm and three of its professionals – who were sued by a client and his adult children for alleged losses resulting from the alleged giving of improper and inappropriate investment advice in connection with the sale of insurance and other investment products – FINRA arbitration conducted in Texas.

• On behalf of plaintiff – a manufacturer of specialty oilfield products – that sued its outside CPA firm in connection with its recommendation that it adopt an Employee Stock Ownership Plan (ESOP) and that its owner sell approximately 25% of his interest in the company to the ESOP to generate the funds he needed to repay his significant shareholder loan without also presenting to him the option of having the company make a Subchapter S Corporation Election as an alternative solution – in state district court in Texas.

• On behalf of plaintiff – a psychiatric hospital – that sued its outside CPA firm and one of its partners – for alleged improper tax advice in connection with the purchase of hospitals and related real estate - arbitration conducted in Texas.

• On behalf of defendant — a Big Four international accounting firm — regarding standards of care in federal tax practice and alleged economic damages in connection with 14 lawsuits for professional malpractice brought by former clients who invested in allegedly abusive tax shelter transactions – in both federal district and state courts in Florida, Georgia, New Jersey, New York, North Carolina, Ohio, Texas, and the District of Columbia.

• On behalf of defendants – a local public accounting firm and CPA partner of the firm – regarding standards of care in federal tax practice and alleged economic damages in connection with a lawsuit for professional malpractice brought by 10 former clients that pertained to the reporting of allegedly abusive tax shelter transaction positions on their federal income tax returns – in state district court in Texas.

• On behalf of defendants - a local public accounting firm and CPA partner of the firm – regarding standards of care in federal tax practice and alleged economic damages in connection with a lawsuit for professional malpractice brought by related-party former clients because the CPA partner did not discover while preparing their income tax returns that an investment manager had embezzled funds from their brokerage accounts – in county court at law in Texas.

• On behalf of defendant — a Big Four international accounting firm – regarding standards of care in federal tax practice and alleged economic damages claimed by a former client asserting professional malpractice for failure to timely prepare a generation-skipping transfer tax allocation election — in state district court in Texas.

• On behalf of defendant – a local public accounting firm – regarding standards of care in federal tax practice and alleged economic damages in connection with a lawsuit for professional malpractice brought by seven former clients who invested in a book publishing tax shelter – in state court in Texas.

• On behalf of plaintiffs – the shareholders of a business that was sold – who sued their former public accounting firm and a CPA partner of the firm for professional malpractice regarding allegedly negligent advice the CPA partner gave that the net working capital of the business as of the date of sale and proposed earnout provided for in the stock purchase agreement would not be materially affected if the stock purchase agreement required that the relevant financial statements of the business be compliant with generally accepted accounting principles (GAAP) – in state district court in Texas.

• On behalf of defendant – a law firm – that was sued by a property & casualty insurance carrier over the fees it charged for representing the carrier in an underlying lawsuit in which the carrier provided the performance bond for a botched construction job at the Port of Houston — in federal district court in Texas.

• On behalf of defendant – an energy industry software business – that was sued by its former CFO, a CPA, for wrongful termination in which I assessed the CFO’s actions and activities with respect to the rules of professional conduct for Texas CPAs established by the Texas State Board of Public Accountancy – arbitration conducted in Texas.

• On behalf of defendant – a CPA practicing public accounting – who was sued by an Order of Nuns for professional malpractice for allegedly performing services that were not requested, which resulted in overcharges for his services — in state district court in Texas.

• On behalf of the Texas State Board of Public Accountancy – I investigated allegations of misconduct by a Texas CPA serving in the capacity of an expert witness regarding whether he issued reports without review of the books and records of his client, thus placing him in violation of the State of Texas Public Accountancy Act and/or the Rules of Professional Conduct of the Texas State Board of Public Accountancy.


Copyright © 2008-2015 Alan D. Westheimer   All Rights Reserved.