In class action–related securities litigation brought by opt-out plaintiffs, Cornerstone Research supported Timothy Lucas, former director of research and technical activities at the Financial Accounting Standards Board and former chairman of its Emerging Issues Task Force.
Retained by Cravath, Swaine & Moore
In class action–related securities litigation brought by opt-out plaintiffs, Cornerstone Research supported Timothy Lucas, former director of research and technical activities at the Financial Accounting Standards Board and former chairman of its Emerging Issues Task Force. Mr. Lucas evaluated the plaintiffs’ claims about AOL’s financial accounting and reporting. The plaintiffs alleged that AOL had inappropriately recognized revenue on various transactions in which it sold advertising and, in some cases, concurrently purchased services or equipment from or invested in the counterparties.
Mr. Lucas determined that it would have been reasonable to conclude that the original accounting treatment was in accordance with Generally Accepted Accounting Principles (GAAP).
As part of his work, Mr. Lucas reviewed AOL’s restatement of its financial statements and assessed findings by the SEC and an independent examiner. Mr. Lucas determined that, based on the relevant authoritative accounting guidance and evidence available to AOL’s accounting staff at the time of the transactions, it would have been reasonable to conclude that the original accounting treatment was in accordance with Generally Accepted Accounting Principles (GAAP). The case settled.
