BNEC

In 1982 Ernst & Young was hired as auditor of BNEC and the subsidiaries.

BNEC said that it was unaware of its own and the subsidiaries' financial condition because the firm had failed to perform its duties competently.

The firm made a motion to dismiss BNEC's claim, arguing that the shareholder's injury due to the failed banks' deterioration in value did not give rise to a direct claim against the auditor.