'08 Class Actions & Awards Drop—But Not for Long, Magazine Predicts
Both the number of securities class actions and the amount of money they earned for plaintiffs dropped in 2008, a new report says.
But the downturn won’t last for long, predicts CFO magazine. For one thing, the article points out, when one area of securities practice falls, plaintiffs attorneys generally soon find another to focus on.
There were only 99 settlements of securities class actions in 2008, compared to 110 in 2007, according to a report by Cornerstone Research. It was based on statistics compiled by the Stanford Law School Securities Class Action Clearinghouse.
And the average settlement plummeted in 2008, to about $31 million from well over $62 million.
One new area of securities litigation of interest to practitioners is pending actions against Troubled Asset Relief Program recipients. Settlements of these cases “will raise novel public policy issues,” says Joseph Grundfest, referring to the new federal Trouble Assets Relief Program. He is the director of the Stanford clearinghouse. Among them, taxpayer funding, directly or indirectly, will pay for these settlements, he says, which is likely to be controversial.
More details about last year’s securities class action cases are provided on a Cornerstone Research website that provides links to its press releases and reports.
Updated at 7:40 p.m. to include link to Cornerstone Research material.
