As I have detailed in prior posts, U.S. securities class action lawsuit filings remained at historically high levels in 2019. Among the 2019 securities suit filings were significant number of lawsuits filed against non-U.S. companies with U.S. listings. As detailed in a new report from the Dechert law firm, there was an uptick in 2019 the number of U.S. securities lawsuits filed against non-U.S. companies compared with the year prior. The Dechert report also details a number of trends with respect to filings against non-U.S. companies, as well as the trends with respects to dispositive motions in these cases. The March 11, 2020 report can be found here.
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As previously reported (here), 2019 was a relatively slow year for securities class action lawsuit settlements compared to 2018. However, there were a number of significant securities lawsuit recoveries and the total recoveries in the aggregate were for at least some law firms quite substantial. In a March 11, 2020 report entitled “The Top 50 of 2019,” ISS Securities Class Action Services sets out a list of the top 50 law firms  — ranked by total cash amount and by number of cash settlements – with respect to final securities class action lawsuit settlements in 2019 in North America (inclusive of both the U.S. and Canada). ISS’s report can be found here.
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Tiago Duarte-Silva
Assen Koev

In order to obtain class certification, the 10b-5 action plaintiff must show that the defendant company’s shares trade in an efficient market. In order for a court to determine whether the company’s shares trade in an efficient market, it must consider the five “Cammer factors,” of which one is whether the company has a sufficient number of analysts following its stock. In the following guest post,  Tiago Duarte-Silva, Vice President, Charles River Associates, and Assen Koev, Principal, Charles River Associates, take a look at this Cammer analyst factor and what it may tell us about 10b-5 actions. A version of this article previously was published by Charles River Associates as a newsletter. I would like to thank Tiago and Assen for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Tiago’s and Assen’s article.
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There were slightly fewer securities class action lawsuits and for fewer total dollars in 2019 compared to 2018, but the median settlement amount was unchanged in 2019 from the year prior, according to the annual securities suit settlement report from Cornerstone Research. The report, which is entitled “Securities Class Action Settlements: 2019 Review and Analysis,” states that the $11.5 million median securities class action settlement in 2019 was 34 percent higher than the 2010-2018 median. The report can be found here. Cornerstone Research’s February 26, 2020 press release about the report can be found here.
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In the following guest post, Jay Knight, Taylor Wirth and Chris Johnson of the Bass, Berry & Sims law firm review the key developments at the Securities and Exchange Commission (SEC) during 2019, and consider what to expect in the months ahead. I would like to thank the authors for allowing me to publish their article as a guest post on my site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.
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As was the case for the last two reporting years, there were relatively few larger securities class action lawsuit settlements during 2019 compared to prior years. As reported in latest large securities class action lawsuit settlement report from ISS Securities Class Action Services (ISS), there were only two settlements finalized in 2019 large enough to make the list of all time large settlements. However, there are a number of pending tentative securities class action lawsuit settlements that are likely to be finalized in 2020, and thus are likely to lead to an increase in the number of Top 100 settlements during the year. The February 20, 2020 report, entitled “The Top 100 U.S. Class Action Settlements of All Time (as of December 31, 2019)” can be found here.
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Over the last several years, plaintiffs’ lawyers have filed a number of D&O lawsuits against companies that had been hit with a cybersecurity incident. These suits have largely been unsuccessful, with the exception of the lawsuits filed against Yahoo in the wake of that company’s data breach. While the plaintiffs’ track record in data breach-related D&O lawsuits so far has not been good, a recent development could suggest that that has changed. On February 13, 2020, the parties to the Equifax data breach-related lawsuit filed a stipulation of settlement stating that the case has been settled based on the defendants’ agreement to pay $149 million. The settlement is subject to court approval. This settlement has a number of interesting implications, as discussed below. A copy of the parties’ stipulation of settlement can be found here.
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In the course of my various foreign travels, I have had occasion to speak to many underwriters and brokers who place D&O insurance for non-U.S. companies whose American Depository Receipts (ADRs) trade in the U.S. There is a pervasive, inexplicable, and mistaken belief among some underwriters and brokers that companies whose Level I ADRs trade in the U.S cannot be subject to a U.S. securities suit. These individuals persist in this error despite the Toshiba case, in which the Ninth Circuit reversed a district court’s dismissal of the securities suit brought by investors in Toshiba’s unsponsored Level I ADRs. Because of the persistence of the error about the potential liability of companies with ADRs trading in the U.S., it is mandatory for every single underwriter or broker who places D&O insurance for a non-U.S. ADR company to read the latest court ruling in the Toshiba case. As discussed below, the U.S. securities lawsuit brought against Toshiba brought by purchasers of the company’s unsponsored Level I ADRs is going forward. 
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Cornerstone Research has released its annual survey of securities class action lawsuit filings for 2019. The year’s version of the report introduces some notable innovations. In prior years, the annual report focused exclusively on federal court securities suit filings. In last year’s report, the survey also incorporated significant state court securities litigation data. This year for the first time the report fully incorporates the state court data in the presentation and analysis. The updated report also includes several new interesting perspectives on the past year’s securities litigation filings, particularly with respect to state court lawsuit filings. As the report details, the state court filings “helped push filing activity to record levels.”
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As I noted in my recent analysis of the 2019 securities class action litigation filings, one of the significant factors driving the near-historical levels of securities suit filings during the year was the elevated levels of securities litigation against life sciences companies. A January 21, 2020 report from the Dechert law firm, entitled “Dechert Survey: Developments in Securities Fraud Class Actions Against U.S. Life Sciences Companies: 2019 Edition” (here), details the 2019 securities lawsuit filings against life sciences companies, and reports that once again life sciences companies were “popular targets” for securities litigation claims.
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