Trends in 2019 Securities Class Actions: Filings Remain High, Resolutions Have Slowed, and Median Settlement Rises

21 January 2020

New York, NY—Federal securities class action filings in 2019 remained high for the third straight year, according to an annual report released by NERA Economic Consulting. “Recent Trends in Securities Class Action Litigation: 2019 Full-Year Review” finds an uptick in standard cases, the highest recorded median settlement value since 2012, and a decrease in resolutions driven by fewer settlements.

“2018 and 2019 both saw 433 cases filed, but the nature of these cases shifted considerably in the last year,” said NERA Managing Director Dr. David Tabak. “Filings under Rule 10b-5, Section 11, and/or Section 12 in the Second Circuit increased by 39%, and we saw a decline in merger-objection cases, among other changes.”

Though cases filed against companies in the health and technology services sector have been in decline since 2017, filings in this sector accounted for the most non-merger-objection filings, making up 21% of cases. The electronic technology and technology services sector was a close second, with 20% of filings.

Resolutions fell in 2019 to 312 cases, down 8% from the previous year and ending a three-year uptick. Once again, dismissals accounted for most of the resolutions. Ninety-eight cases were settled, the fewest this decade.

Key Trends in 2019

  • Cases against companies in the cannabis industry were filed for the first time, with six filed between July and December 2019.
  • The 2018 wave of event-driven litigation related to the opioid crisis and the #MeToo movement fell flat in 2019. Filings alleging cyber security breaches increased.
  • The most cases were filed in the Second Circuit, followed by the Ninth. At 108, the number of Second Circuit filings was nearly double that of the Ninth, which saw 56.
  • Cases alleging missed earnings guidance spiked in 2019, appearing in more than 30% of complaints filed as the single most common allegation.
  • Over the past 20 years, the ratio of securities class action filings to publicly listed companies increased from 2.94% to 7.94%.
  • The average settlement value dropped sharply to $31 million, the lowest in a decade. Spikes in this average are often due to large outlier cases, like the 2018 Petrobras settlement, and no such mega-settlements were approved in 2019.
  • The median settlement value was $12.4 million, the highest since 2012, indicating that more cases are settling for higher values than in previous years.
  • Aggregate NERA-defined Investor Losses for filed cases decreased from 2018’s record high of $929 billion to $519 billion, largely due to a decline in cases with Investor Losses of $5 billion or more. However, aggregate Investor Losses for cases with losses of $5 billion or less was $173 billion, the highest this decade.

NERA Securities Class Action Trends Report Series

NERA has been analyzing trends in securities class actions for more than 25 years. This year-end study, “Recent Trends in Securities Class Action Litigation: 2019 Full-Year Review,” is coauthored by NERA Consultant Janeen McIntosh and Senior Consultant Svetlana Starykh, with contributions from Dr. Tabak. In addition to NERA’s US report, the firm produces annual reports on securities class action litigation in Canada and on UK regulatory enforcement actions.

About NERA

NERA Economic Consulting ( is a global firm of experts dedicated to applying economic, finance, and quantitative principles to complex business and legal challenges. For more than six decades, we have been creating strategies, studies, reports, expert testimony, and policy recommendations for government authorities and the world’s leading law firms and corporations. We bring academic rigor, objectivity, and real-world industry experience to issues arising from competition, regulation, public policy, strategy, finance, and litigation.

NERA’s clients value our ability to apply and communicate state-of-the-art approaches clearly and convincingly, our commitment to deliver unbiased findings, and our reputation for quality and independence. Our clients rely on the integrity and skills of our unparalleled team of economists and other experts backed by the resources and reliability of one of the world’s largest economic consultancies. Continuing our legacy as the first international economic consultancy, NERA serves clients from major cities across North America, Europe, and Asia Pacific.