The boom in federal securities class action litigation continued in the first quarter of 2003 with 65 unique actions and 364 total cases filed. Over 100 different law firms throughout the United States filed at least one case during the period, according to the latest issue of Securities Class Action: Plaintiffs’ Counsel Watch. The report found that three plaintiffs’ firms: Cauley Geller Bowman & Coates, LLP; Schiffrin & Barroway LLP; and Milberg Weiss Bershad Hynes & Lerach LLP were the most active filers during the period.
During the quarter, the Federal Courts approved 35 preliminary settlements with a total cash value of $435,954,250 and 18 final settlements with a total cash value of $222,144,000.
Lead plaintiffs were appointed by the Courts in 76 federal securities class actions during the period. Institutional shareholders were appointed as lead plaintiffs in only thirty-three percent of the cases. “Despite the preference for institutional shareholders to act as lead plaintiffs outlined in the Private Securities Litigation Reform Act, the majority of federal securities class actions continue to be led by individual investors,” commented Dan Shinnick, president of Verteris.
Approximately 68% or $152 Million of the $222 Million in cash that was recovered from the final settlements this quarter will be distributed to shareholders through the claims administration process, according to Verteris estimates. “The percentage of a settlement fund actually distributed to shareholders, % shareholder recovery, is a critical metric,” explained Mr. Shinnick, “Ultimately, shareholders are interested in the bottom line benefit of the litigation. Fees and expenses for law firms, claims administrators and others are always paid out of settlement funds before the remainder is distributed to shareholders.”
The Securities Class Action: Plaintiffs’ Counsel Watch is the first scheduled publication to document the activities and performance of plaintiffs’ counsel engaged in securities class action litigation. The quarterly report provides institutional shareholders with objective data and performance metrics to consider in the process of selecting and monitoring outside counsel. Data and metrics in the report are calculated based on Verteris Corporation’s proprietary database of federal securities class action litigation. More information about the report can be found at www.securitiesclassactiondirectory.com/report.