A federal appeals court ruled against PricewaterhouseCoopers in a long-running bankruptcy case that could now examine whether the firm acted in good faith as the auditor for a defunct hospital system.

The case involved the Allegheny Health, Education and Research Foundation, a Pittsburgh-based nonprofit hospital system that filed for bankruptcy in July 1998 with approximately $1.3 billion in debt, according to Reuters. Coopers & Lybrand had been AHERF’s auditing firm before merging with Price Waterhouse in 1998. A committee of unsecured creditors accused the firm of giving a clean opinion in its 1996 and 1997 audits of AHERF despite the precarious state of the hospital system’s finances.

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