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Tips for
Institutions Regarding Securities Class Actions
Being a
Lead Plaintiff
With the 1995
passage of the Private Securities Litigation Reform Act ("PSLRA"),
Congress intended to refine the securities class action lawsuit,
making such suits more effective and efficient at compensating
victims and deterring corporate wrongdoing. Putting institutional
investors in the role of lead plaintiff to control and oversee
the interests of the plaintiff class is an essential element
of the reform.
Prior to the PSLRA, the Lead Plaintiff in a securities
class action was often determined by who could file a complaint
the fastest. Despite other criticisms which the PSLRA has received,
it has clearly put the large institutional investor in the role
of lead plaintiff to control and oversee the interests of the
plaintiff class and that is considered a successful "reform"
in all circles.
The Responsibilities/Duties
of Lead Plaintiffs:
selecting competent counsel to represent
the class
negotiating reasonable attorneys' fees
overseeing the prosecution of the litigation
The Benefits of Institutional Investors
as Lead Plaintiffs:
improve chances
of a successful action
increase settlement
amounts
achieve real
changes in corporate governance
materially
reduce attorneys fees
play an important
role in fighting fraud
provide many,
many more benefits...
For a more detailed description of the benefits which Institutional
Investor Lead Plaintiffs bring to the prosecution of securities
class actions, read
"Your
Portfolio Has Been Hurt by a Securities Fraud...Now What?" by BLB&G's
Max Berger,
David Stickney and
Tony Gelderman
(portions of which were previously published in the May 2002 issue of
The NAPPA Report, the
signature publication of the National Association of Public Pension Attorneys).
If you would like information about becoming
a Lead Plaintiff in a securities fraud action, please contact
us at blbg@blbglaw.com.
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