Marc S. Kirschner, as Trustee of the Refco Litigation Trust, Appellant v. Kpmg LLP, Respondents…

Summary

The New York Court of Appeals answered certified questions, holding that the adverse‑interest exception does not apply merely because insiders intended personal benefit (question 2: No) and that the exception applies only when the insiders' misconduct harms the corporation (question 3: Yes); consequently, the in pari delicto doctrine bars the derivative claims against auditors in the Teachers’ Retirement case. The Court declined to expand the exception or alter established imputation principles.