Rigas, auditors battle heating up
Rigases ask court to proceed with civil trial

A legal battle between the Rigas family and auditing firm Deloitte & Touche heated up this week. The Rigases asked a Philadelphia court to proceed to trial on claims Deloitte filed against them, stemming from financial dealings involving both the family and Adelphia.

"We 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," said James Rigas, one of John and Doris Rigas's three sons.

"Contrary to Deloitte's persistent public statements, Deloitte auditors possessed all the information they needed to perform thorough and accurate audits," Rigas continued. "At no time did any of the Rigases withhold information from Deloitte or instruct any other Adelphia employee to do so . . . Deloitte's reluctance to go to trial reflects a fear that a Philadelphia jury, as well as the financial and accounting worlds, will see this evidence and hold Deloitte accountable for its actions."

Deloitte & Touche sued the Rigases in 2003, alleging fraud and negligent misrepresentation. Earlier this month, a judge dismissed a portion of the claims. Then, last Thursday, Deloitte withdrew the others. However, the Rigases want the judge to strike that action and require the case to be tried on its merits.

In their release, the Rigases said, "Deloitte's failure to stand behind its own recommendations, advice and audit work was a precipitating factor and major cause of the collapse of Adelphia. Deloitte's refusal to cooperate with the Rigases prior to the criminal trial prevented John and Timothy Rigas from presenting a complete defense, resulting in an inaccurate picture of the events at Adelphia which contributed to an erroneous verdict."

Deloitte is disputing the Rigases' allegations.

"The Rigas family's false comments do not alter the fact that members of the Rigas family were found criminally responsible for the fraud that was perpetrated at Adelphia, a fraud which was in large part directed at Deloitte and Touche," said Deborah Harrington, director of national public relations for the firm.

Harrington also said the case against the Rigas family is not being "dropped."

"Instead," Harrington said, "Deloitte intends to file its claim against (the Rigases) in a proceeding pending in New York."

But the Rigases claim Deloitte can't legally drop the suit in one court and re-file it in another.

Deloitte paid a $50 million settlement to the federal government after allegations were brought by the U.S. Securities & Exchange Commission. Deloitte also paid $210 million to settle with Adelphia's investors and hundreds of millions of dollars to settle with the Adelphia estate.

John Rigas and Tim Rigas were each convicted of fraud and conspiracy. They're serving terms of 20 years and 15 years, respectively, at a federal prison in Butner, N.C. A petition for a new trial is pending before the court and the Rigases have vowed to appeal to the U.S. Supreme Court if necessary.