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wrong doing?
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Do you want to find out whether a company you own shares in
has been sued?
Recently Filed Actions
A securities class action is brought pursuant to Federal Rule of Civil Procedure 23. on behalf a group of persons who purchased the securities of a particular company during a specified period of time. Pursuant to Rule 23, one or more members of a class may sue as representative parties if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class. A class action is usually superior to all other available methods for the fair and efficient adjudication of securities fraud claims brought by shareholders since joinder of all members is impracticable. Furthermore, as the damages suffered by individual class members may be relatively small, the expense and burden of individual litigation make it impossible for members of the class to individually redress the wrongs done to them.
Generally, there are two opportunities in which an individual investor can participate in a class action. The first opportunity is for an individual to institute the action. This requires the investor to contact an attorney about a possible fraud, the attorney will then conduct an investigation and if there is cause file a lawsuit on behalf of the investor. (You can report fraud or have us conduct a free investigation). The second opportunity is for an individual investor to join an existing action. Under the Private Securities Litigation Reform Act ("PSLRA") notice of a securities class action lawsuit must be published in a nationwide publication in order to give notice to potential class members and allow them to participate.
No. Any investor that has purchased shares in the security at issue during the class period announced in the notice (also called a "Class Period") is automatically a member of the purported class. If you wish to take a more active role in the litigation or simply lend support to the plaintiff class, you may fill out a certification of lead plaintiff.
As a member of the class who did not petition the court to become a lead plaintiff (i.e. fill out a certification) you have no obligations. If the action is resolved in favor of the plaintiff class, members are sent a notice and a claim form which provides instructions on how to receive a share of the settlement or verdict. If you own the shares directly you can expect that this notice will be sent to you. If the shares are owned in street name, the notice will be sent to your broker who then has the responsibility to send it directly to you.
If you filled out a certification or otherwise petitioned the Court to be appointed as lead plaintiff you may have additional obligations enumerated in the Certification of Lead Plaintiff.
It is very important to ask any attorney you retain to explain the fees they charge for representation. Attorneys representing shareholders in class actions most often operate on a contingency basis. This means the shareholder does not have to pay for a lawyer out of his/her pocket, but rather attorney fees are paid out of the potential settlement or verdict. The exact amount is determined and awarded by the court. If the class does not prevail, the attorneys do not get paid.
The ultimate goal of a securities class action suit is twofold: (1) Stop the company from continuing fraudulent conduct and prevent similar such conduct from occurring in the future; and (2) Seek remuneration/damages for aggrieved shareholders. Shareholders should not expect to receive all monies lost due to fraud back in the form of damages. Rather, most class action settlements return a percentage of the investment loss. There are a number of reasons for this: First, most often a damage calculation of the losses for all aggrieved shareholders will be a figure so substantial that it would surpass applicable insurance and bankrupt or severely cripple the owing company. Shareholders of a bankrupt company are not secured creditors and would be relegated to the end of a creditor list where they would be lucky to get anything at all. Second, many shareholders retain ownership of stock in the company in the hopes that at some point they will be able to recoup their investment. Crippling or bankrupting a company with a huge settlement would undermine the position of those shareholders who continue to hold and those who have subsequently invested. Third, a company has no incentive to settle the litigation if plaintiffs seek the highest amount of damages possible. They would just as soon fight the lawsuit and take their chances in front of a jury. Fourth, attorneys fees and costs associated with the litigation are taken off the top of any settlement. Attorneys petition the court for their fees and most commonly receive either a flat percentage of the hours they put in the case (at their hourly rates), with or without a multiplier. All these factors can operate to diminish an individuals remuneration. Ultimately, each shareholder has to keep in mind the purpose of the action -- to retrieve an investment loss, punish the company and its directors for committing fraud, prevent them from doing it again and to set an example for other publicly held companies.
Do you have a company that you want to investigate for
possible wrong doing?
Report Fraud
Do you want to find out whether a company you own shares
in has been sued?
Recently Filed Actions