Typically, a settlement consists of a payment of cash, stock, or combination of both to a common fund to be distributed to the class in proportion to the amount each class member is determined to have lost. Securities cases not dismissed for legal reasons at the outset of the litigation usually settle. Until the litigation is well under way, it is impossible to determine what recovery might be possible, whether by settlement or following judgment at trial. The sixty-day deadline applies only to those seeking to be Lead Plaintiff. If you purchased your shares during the class period and sustained losses you are automatically part of the class action. I missed the 60 day Lead Plaintiff Deadline. If you wish to be a Lead Plaintiff in a particular case, you must contact Berger Montague at least five business days in advance of this deadline. The application deadline is strictly applied. Also, depending on the circumstances, several entities and/or individuals may be appointed to serve as “Co-Lead Plaintiffs.” What is the “Lead Plaintiff Deadline?”Īpplications for Lead Plaintiff must be filed within the 60-day period following the first filing of a class action complaint in a federal securities fraud case. Some courts appoint the Lead Plaintiff based on the dollar amount of the loss due to the securities law violations alleged, and some courts base this decision on the percentage of net worth loss. The “largest financial interest” can be determined by courts in a variety of ways. The Private Securities Act of 1995 provides that the most adequate Lead Plaintiff is the person or group of persons who, in the determination of the court, has the largest financial interest in the relief sought by the class. How does the court determine who serves as Lead Plaintiff? The Lead Plaintiff has control over the course and direction of the litigation. Under certain circumstances, more than one class member may serve as Lead Plaintiff. To appoint a Lead Plaintiff, a court must determine that the proposed Lead Plaintiff’s claims are typical of those of the other class members, and that the Lead Plaintiff will adequately represent the interests of the class as a whole. What is a “Lead Plaintiff?”Ī Lead Plaintiff is a representative person(s) or party appointed by the court who stands in for and acts on behalf of the other class members in the litigation. Sometimes the class period changes during the course of litigation as additional information is uncovered during the discovery process. The class period initially is determined by plaintiffs’ counsel after extensive research and investigation. The class period typically is the time frame during which it is believed that alleged fraud or other securities law violations artificially inflated the price of the stock at issue in the case. Only persons who purchased stock during this period are included in the class action suit. What is a “class period” in a securities case and how is the class period determined? Securities Class Action FAQs What is a securities class action?Ī securities class action is a lawsuit brought on behalf of a group of investors who have suffered an economic loss in a particular stock or security as a result of fraudulent stock manipulation or other violations of federal or state securities law. In federal practice, such cases are brought by one or more investors in the stock, known as “Lead Plaintiffs,” on behalf of all others who have suffered financial losses as a result of purchasing shares in a company during the period of time the fraud or securities laws violations artificially inflated the value of the stock (known as the “class period”).
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