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Archive for July 25th, 2008

Two news sources reported today on a forum sponsored by the Manhattan Institute to discuss a research paper releaseed by the U.S. Chamber of Commerce Institute of Legal Reform (ILR).  See the Wall Street Journal’s Market Watch section and an American Lawyer article by Brian Baxter posted on Law.com.  The report and press release is available for viewing at the IRL website: www.InstituteforLegalReform.com

Among numerous other statistics provided in the report, the report states that securities class action filings increased by 58% in 2007 over 2006 and that $51.8 billion was paid out in securities class action settlements over the last decade.  The report also states that the average dollar amount per settlement increased by 43%, not taking into account “billion dollar plus settlements,” and contends that “[b]etween 1995 and 2005, securities class action litigation caused the destruction of nearly $25 billion of shareholder wealth.”  The report offers various proposals for securities class action reform, including the adoption of the “Securities Litigation Attorney Accountability and Transparency Act,” (S.3033, H.R. 5463), or SLAATA, a bill being championed by Texas Senator John Cornyn.  (See this previous ClassActionBlawg.com entry).

The ILR has an unapologetically pro-business slant, but whether you agree or disagree with the organization’s views, the statistics provided and issues raised in the report are important ones to consider in the ongoing debate over securities and other class action reform.

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