Sterling bought a loan portfolio that included loans made to Allied Deals, Inc., whose business involved a Ponzi scheme to defraud banks. Sterling claims to have relied on unqualified audit reports of E & Y in continuing to make advances to Allied, notwithstanding that by 2001, 90% of Allied’s business was fictitious. Justice Chan denied defendant’s motion for summary judgment, finding issues of fact existed as to causation, damages, justifiability reliance and punitive damages.