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This Q1 2020 update extends analyses highlighted in the February 2020 report “Recent Trends in Securities Class Action Litigation: 2019 Full-Year Review,” coauthored by NERA Consultant Janeen McIntosh and Senior Consultant Svetlana Starykh.

Early activity indicates a decline in new securities class actions filings in 2020. New case filings between January and March declined 10% compared to filings over the same three-month period in 2019. The first COVID-19-related cases have begun to emerge, with two such cases filed in March. Based on Q1 activity, there has been a decrease in the pace of Rule 10b-5 filings compared to the 2017–2019 levels.

Between January and March, there was an uptick in dismissed cases and a dip in settlements. Despite the decline in settled cases, the average settlement amount for 2020 increased relative to 2019, driven primarily by the American Realty Capital Properties settlement for $1.025 billion. After excluding settlements over $1 billion, the average and median settlement amounts have been lower over the early part of the year compared to the average and median amounts in 2017 and 2018.