What are Securities Class Actions?A securities class action is a lawsuit brought by and on behalf of all investors who purchased shares of the same stock or security who lost money on that investment because some kind of securities fraud was perpetrated that artificially inflated or deflated the value of the stock. Typically what happens is that an investor initiates the lawsuit and acts as the ¿representative¿ for all investors who owned shares of the stock when the fraud was committed. These lawsuits can typically go on for a few years, and will result in a settlement, a judgment, or a dismissal. If a settlement is reached, typically funds in the form of either cash or securities will be distributed to the plaintiff stockholders in the case. How Do I Become Involved in a Securities Class Action?If there is a securities class action involving a security you own and you wish to be involved in the lawsuit, you should contact the attorneys of the ¿representative¿ investor (i.e., the investor who filed the class action). It does not matter if you have already sold the security, as long as you were a holder in the time period that the fraud took place and experience a financial loss as a result. To look to see if there are any class action lawsuits involving securities you own, you may want to check the Securities Class Action Clearinghouse run by the Stanford University School of Law, or just type the name of security into a search engine and see what pops up. Should I Consult an Attorney if I Get Involved in a Securities Class Action?
While it is not necessary to have a qualified attorney if you are not the class representative, you may want to consult an attorney who has experience in class actions and securities laws so that you know what you are getting into. Your lawyer can explain the class action procedures to you and let you know how much money you would receive if the judgment or settlement goes in your favor. |
