CGYC - Judge `Temporarily Suspends' Trial in Carnegie's $2.1 Billion Suit vs. Grant
Thornton; Court Orders Investigation of Alleged Discovery Violation by
Defendant
BALTIMORE, Nov 15, 2001 (BUSINESS WIRE) -- Carnegie International Corporation
(OTC BB: CGYC) said today that the trial of its action against Grant Thornton,
LLP, its former auditor, has been temporarily suspended pending the outcome of
an investigation ordered by the court of an alleged discovery violation by Grant
Thornton.
Carnegie President Lowell Farkas said that the trial, which began November 5 in
Baltimore Circuit Court, was in process when Grant Thornton's counsel announced
in open court that a second set of "original work papers" had been discovered.
He said that in the pronouncements made on November 9, Grant Thornton admitted
that it had not produced these files during the discovery process.
Judge Kaye A. Allison then suspended the trial to appoint a "third party
neutral" to investigate and report back to the Court. Upon receipt of that
report, the Court will determine the course of further proceedings, including
whether to grant Carnegie's motion for default judgment on all counts.
Grant Thornton was engaged by Carnegie to audit years 1997 and 1998; those
reports were included in the company's SEC filings. In May of 2000, Carnegie
brought suit against Grant Thornton in Baltimore Circuit Court, alleging that
Grant had failed to perform its obligations relating to the audits of 1997 and
1998 as well as fraud.
In related proceedings, Farkas said the court has scheduled a hearing for
November 28, 2001, to rule on sanctions requested by Carnegie based on the
destruction of other documents by J.W. "Mike" Starr, a senior Grant Thornton
officer. (see "Carnegie International Corporation Seeks Default Judgment in $2.1
Billion Suit vs. Grant Thornton, LLP," Business Wire, July 31, 2001).
About Carnegie International Corporation
Carnegie International Corporation is an Internet support and computer telephony
holding company with specialization in telecommunications products, services and
distribution, and in E-Commerce and EDI.
Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for
forward-looking statements. Certain information included in this Press Release
(as well as information in oral statements or other written statements made or
to be made by Carnegie International Corporation) contain statements that are
forward-looking, such as statements relating to the future anticipated direction
of the telecommunications industry, plans for future expansion, various business
development activities, planned capital expenditures, future funding sources,
anticipated sales growth, and potential contracts. Such forward-looking
information involves important risks and uncertainties that could significantly
affect anticipated results in the future, and accordingly, such results may
differ from those expressed in any forward-looking statements made by or on
behalf of Carnegie International Corporation. These risks and uncertainties
included, but are not limited to, those relating to development and expansion
activities, dependence on existing management, financing activities, domestic
and global economic conditions, change in Federal or state laws, and market
competition factors.
CONTACT: Press:
Lowell Farkas
Carnegie International Corporation
+(410) 785-7400
lfarkas@carnegieint.com
or
David A. Kaminer
The Kaminer Group
+(914) 684-1934
dkaminer@kamgrp.com |
