Download the report here
New York – June 11, 2019 – Chubb today released a new report on the rising volume of securities class action lawsuits, which have more than doubled in the last four years. The report, From Nuisance to Menace: The Rising Tide of Securities Class Action Litigation, examines the origin, scope and cost of securities class actions, as well as pragmatic proposals for reform. The report features proprietary Chubb claims analysis and perspectives from some of the top securities lawyers in the U.S.
The data and insights in the Chubb report add to growing research about the costs to business and society from meritless securities class actions. In 2017 and 2018, the number of securities class actions filed in federal court broke new records each year, and the volume has doubled since 2014, according to NERA Economic Consulting. Last year, Cornerstone Research found that an average of one in 12 public companies was the target of a securities class action. Among S&P 500 companies, the likelihood was one in 10.
“There is a growing cohort of lawyers filing meritless lawsuits in federal and state courts across the United States every time a merger or acquisition is announced or a corporate misfortune impacts a company’s share price,” said John Keogh, Executive Vice Chairman and Chief Operating Officer of Chubb. “The financial rewards from these lawsuits are accruing not to harmed investors but to lawyers who are bringing cases of dubious merit in order to reap a windfall in legal fees and a disproportionate share of settlement dollars.”
Read the full press release here.
The kinds of abuses that led Congress to act in the 1990s have returned, as a new and rapidly growing segment of the plaintiffs’ bar has found fresh ways to bring lawsuits against businesses, collect fees and reap a disproportionate share of the benefits.
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To view the Chubb-hosted 2018 Securities Class Action Reform Panel Discussion click here: https://news.na.chubb.com/spotlight-1