BAKER v. GOLDMAN, SACHS & CO.

Nos. 13-2173, 13-2208.

771 F.3d 37 (2014)

James and Janet BAKER; Paul G. Bamberg and Robert Roth, Plaintiffs, Appellants, v. GOLDMAN, SACHS & CO., et al, Defendants, Appellees.

United States Court of Appeals, First Circuit.

November 12, 2014.


Attorney(s) appearing for the Case

Alan K. Cotler , with whom Joan A. Yue , Debra A. Djupman , Roy D. Prather III , Reed Smith LLP, Peter C. Horstmann , and Partridge, Ankner & Horstmann, LLP were on brief, for appellants James and Janet Baker.

Christian M. Hoffman , with whom Jack R. Pirozzolo , Catherine C. Deneke , and Foley Hoag LLP were on brief, for appellants Paul G. Bamberg and Robert Roth.

John D. Donovan, Jr. , with whom Daniel V. McCaughey , Matthew L. McGinnis , Timothy R. Cahill , Ropes & Gray LLP, Paul Vizcarrondo , John F. Lynch , Carrie M. Reilly , Lindsey M. Weiss , Molly K. Grovak , and Wachtell, Lipton, Rosen & Katz were on brief, for appellees Goldman, Sachs & Co., et al.

Before LYNCH, Chief Judge, TORRUELLA and RIPPLE, Circuit Judges.


LYNCH, Chief Judge.

Dragon Systems, Inc. ("Dragon"), a leading voice recognition software company in the late 1990s, needed infusions of capital to continue operations and so sought an acquisition partner. It hired an investment banker, Goldman Sachs ("Goldman"), to assist it. Dragon was acquired in June 2000 by Lernout & Hauspie Speech Products N.V. But Lernout & Hauspie had fraudulently overstated its earnings. When that was learned, bankruptcy ensued for...

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