Supreme Court Denies Audit Firm’s Petition for Writ of Certiorari

On October 6, 2025, the U.S. Supreme Court denied BDO’s petition for a writ of certiorari in New England Carpenters Guaranteed Annuity and Pension Funds v. AmTrust Financial Services, Inc., No. 20-1643-cv (2d Cir. 2024).

As we previously reported in the May 16, 2025 Auditor Liability Bulletin, the Second Circuit initially held that BDO’s alleged misstatements in its 2013 audit opinion were not material and thus were insufficient to state a claim against BDO. However, in an amended Opinion, and “after due consideration of Appellants’ petition for rehearing,” the Second Circuit reversed course, holding that the misstatements were indeed material because the false certification with respect to conducting the audit in accordance with PCAOB standards “subjected unknowing investors to the risk that AmTrust’s financial statements were unreliable.”

In its May 6, 2025, petition for a writ of certiorari, BDO urged the Supreme Court to consider whether the materiality requirement for securities fraud liability is satisfied per se by an auditor’s statement of compliance with professional standards or whether a fact-specific analysis focused on the link between the allegedly false compliance statement and actual misstatements of financial information is required.

The case is BDO USA, LLP, v. New England Carpenters Guaranteed Annuity and Pension Funds et al., case number 24-1151. The petition for a writ of certiorari can be found here and the Order denying certiorari can be found here.