What does it cost me to participate as a named plaintiff in a class action or derivative lawsuit?
There is no out-of-pocket cost to any plaintiff regardless of the outcome. We generally work on a contingent fee basis, where Berens Law LLC pays all costs and expenses. If we are successful in obtaining a recovery, we will ask the court to award the firm fees and expenses from the recovery. The amount of the fee award will be set by the court and will depend on a number of factors, including the size and nature of the recovery and the complexity of the litigation.
What is a class action?
A "class action" is a legal procedure by which an individual or entity may initiate a lawsuit on behalf of all other individuals or entities who are in the same or similar situation. A class action is appropriate when many people have been affected by a company's course of conduct in a similar fashion. However, a case is not an actual "class action" until the plaintiff satisfies certain legal criteria and the court orders the case "certified" as a class action.
What is a securities fraud class action?
A securities fraud class action is a class action lawsuit filed by investors who bought or sold a company’s securities within a specific period of time (see the definition of “class period,” below) and suffered economic injury as a result of violations of the securities laws. In general, securities fraud class actions are brought for violations of the Securities Act of 1933 or the Securities Exchange Act of 1934, and seek to recover damages for injured investors.
What is a class period?
A "class period" is the period of time within which a defendant (that is often a company) is alleged to have been engaged in improper conduct. If you purchased company securities within the class period, you are automatically a putative class member, regardless of whether you specifically retain a law firm to prosecute claims on your behalf. You must have also purchased or acquired company shares during the class period to seek a lead plaintiff appointment.
What is a securities class action lead plaintiff?
A "lead plaintiff" in a federal securities class action is typically appointed by the court within 90 days of the publication of a notice of the pendency of the case. In these types of actions, the court selects the class member (or members) most capable of representing the interests of the other "absent" class members investors. There is a legal presumption that the class period investor with the largest financial loss, who is otherwise typical of the "absent" class members and is adequate to represent those class members, is the "most adequate" plaintiff. Courts have appointed individuals, institutional investors or sometimes combinations of both as lead plaintiff as the circumstances of each case may dictate. The lead plaintiff must stay informed about significant developments in the case and must work with class counsel to make important strategic decisions regarding the conduct and disposition of the litigation.
Why are there so many lawsuits and law firms involved?
When corporate malfeasance harms investors and publicly-traded companies, numerous experienced law firms often investigate and/or file similar legal actions on behalf of different shareholders, sometimes in different jurisdictions. Typically, these related actions will be consolidated into a single lawsuit with the Court determining which investors and lawyers will lead the consolidated lawsuit moving forward. To the extent that the lawsuits are not consolidated, the Court may require various levels of coordination between the pending cases.
What is a shareholder derivative action?
A shareholder derivative action is very different than a securities class action. A shareholder derivative action is a lawsuit brought by a current shareholder for the benefit of a corporation, often to remedy breaches of fiduciary duty by officers and directors. Remedies commonly sought in derivative actions include: corporate governance reforms designed to prevent future fiduciary misconduct; removal of officers or directors whose misconduct injured the corporation; monetary payments to the company (as opposed to shareholders directly); and disgorgement of ill-gotten gains.
How long will it take before the securities class action or derivative action is resolved?
Every case is different. Some cases may settle shortly after the action is filed, while other cases are litigated for many years. A typical shareholder lawsuit will take two to four years to be resolved.