Lawsuit vs Andersen in WorldCom case can proceed

NEW YORK, June 25 (Reuters) – A district judge in the US has denied defunct accounting firm Andersen's request to dismiss a class action lawsuit brought against it for its role as auditor of telephone company WorldCom Inc.

The lawsuit accuses Andersen of failing to properly review and investigate WorldCom's adjustments and journal entries in its books and argues the firm should have discovered the $11 billion accounting fraud at the telephone company.

The ruling handed down by U.S. District Judge Denise Cote on Monday means the lawsuit against Andersen, which collapsed last year because of its role in the Enron debacle, can proceed.

But the judge granted the motion to dismiss claims against Andersen partners Melvin Dick and Mark Schoppet (who led the audits at WorldCom) and Andersen's global umbrella organization and the Andersen affiliate in the United Kingdom.

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