Securities Class Actions: 2016 Full-Year Review and Mid-2017 Flash Update

Mon Jul 24 10:34:43 EDT 2017
By Stefan Boettrich and Svetlana Starykh

In a guest post published on the Harvard Law School Forum on Corporate Governance and Financial Regulation blog, NERA Senior Consultants Stefan Boettrich and Svetlana Starykh review their 2016-year end findings and provide a mid-2017 update on trends in securities class actions. In the 2016-year end report, Recent Trends in Securities Class Action Litigation: 2016 Full-Year Review, the authors noted that the “pace of securities class action filings was the highest since the aftermath of the 2000 dot-com crash” and that the growth “in filings was dominated by federal merger objections.” A review of the 2017 data shows that the surge in securities class-action filings has continued in the first half of 2017.

Mid-2017 Highlights include:

  • Total securities class-action filings rose from 140 in the first half of 2016 to 160 in the second half of the year.
  • That number has increased to 255 in the first half of 2017—an 82% increase over the same period last year and a 59% increase over the second half of 2016.  
  • The number of “standard” cases alleging violations of SEC Rule 10b-5 or of Section 11 or 12 of the 1933 Securities Act fell from 102 in the first half of 2016 to 95 in the second half of 2016, but the number of filings of such cases has risen to 140 in the first half of 2017.
  • The number of merger-objection cases filed rose from 30 in the first half of 2016 to 58 in the second half of the year. The number of such filings has now increased to 104 in the first half of 2017.