The Stanford Securities Class Action Clearinghouse and Cornerstone Research have released their 2006 year in review. Most anyone reading here is probably already familiar with the group's work, but if not, here's the nugget: they track the prosecution, defense, and settlement of federal class action securities fraud litigation.

So, how did the industry fair in 2006? According to the SSCAC, securities suits have fallen to an all time low (well, ok, they are one suit off of the 1996 pace) since the adoption of the Public Securities Litigation Reform Act was adopted in 1995. The SSCAC attributes this drop to a combination of strong Federal enforcement and a relatively stable stock market. You can read the full report here (PDF).

Check the tagged posts below to track back on the SSCAC's recent reports (as well as rebuttals), or just check out their website, where you'll find all manner of helpful tools for the data junkie.

On a potentially better note for plaintiff firms and their clients, a recent report from NERA Economic Consulting found that that class action settlements paid by corporations to shareholder plaintiffs rose by 37% in 2006. NERA also tracked the decline in securities class actions and it may be interesting to compare their numbers.

-- MDT

Labels: class action, securites, Stanford Securities Class Action Clearing House

The Daily Caveat mentioned in passing several days ago that Lerach Coughlin, home of the Wall Street Journal's favorite litigator, Bill Lerach, had been removed from upcoming securities fraud litigation against Halliburton. The client in that case, the Archdiocese of Milwaukee Supporting Fund Inc., has since given more details on the removal of Lerach's firm as well as co-lead counsel, David Scott of Scott + Scott, linking the switch directly to the continuing indictment against Lerach's former firm, Milberg Weiss. As was previously mentioned, DC uber-attorny David Boies has picked up the reins of the case.

Meanwhile Milberg and the plaintiff's bar in general are bracing for what some are calling the trial of the century.

-- MDT

Labels: Bill Lerach, class action, David Boies, Halliburton, indictment, Melvyn Weiss, Milberg, Milberg Weiss, securites

And why they think, in this case, rejection was the right move for the courts...

What are we talking about? Well, it goes something like this... Back in a mystical time we call the dot com boom, there were lots of shady practices from internet-based companies that had a URL, a superbowl ad and not much else in the way of prospects for success. In turn, securities class action firms experienced their own boom, filing case after case, chasing busted dot coms on behalf of their investors (and boy, as a young investigator it was fun to be in the thick of it).

Another issue arising from this era has been the allegedly questionable conduct of the Wall Street bankers behind many of these IPOs. It has been suggested that they manipulated the prices of these public offerings in order to reap great monetary benefits for themselves on the backs of myriad small investors who got caught in their double-dealing wake.

There have been some individual settlements relating to this issue, but another suit had been working its way forward, in which the most of the biggest Wall Street banks would have had their dirty laundry aired. Earlier this month, plaintiffs received a serious setback when a Federal Appeals Court ruled that several of the 310 conglomerated cases that are part of the potentially massive class action were wrongfully given "class" status.

While this doesn't mean the case, which is being led by embattled plaintiff firm, Milberg Weiss is dead, it is a certainly substantial setback for one of the longest running class actions kicking around the courts. So why does TechDirt say this is all so much the better? Find out.

-- MDT

Labels: class action, IPO, Melvyn Weiss, Milberg, Milberg Weiss, securites, Techdirt, Wall Street