Proskauer Rose got some good news Oct. 27, when the 5th U.S. Circuit Court of Appeals affirmed a lower court’s decision in a suit filed over tax advice. The three-judge panel upheld a 2009 decision by U.S. District Judge Gray Miller of the Southern District of Texas (pictured) that dismissed a Racketeering Influenced and Corrupt Organizations Act and securities fraud suit filed against Proskauer in connection with a "tax avoidance scheme" that the Internal Revenue Service disallowed.
The plaintiffs had alleged in their complaint in Affco Investments 2001 LLC, et al. v. Proskauer Rose LLP that Proskauer issued tax opinions to them that were incorrect and did so to promote the tax strategy. In response, Proskauer filed a motion to dismiss. The panel found that Miller properly dismissed securities fraud claims the plaintiffs brought against Proskauer and properly dismissed a RICO claim because it was barred under the Private Securities Litigation Reform Act.