Securities Class Action

A securities class action, or securities fraud class action, is a lawsuit filed by investors who bought or sold a company’s securities within a specific period of time (known as a “class period”) and suffered economic injury as a result of violations of the securities laws. In cases involving misleading statements or omissions, a class period generally starts when a company makes an untrue statement of material fact about the company or fails to disclose a material fact necessary to render other statements not misleading. The class period generally ends when the truth is fully disclosed to the investing public.

"Cases are brought pursuant to Federal Rule of Civil Procedure 23 on behalf of a group of persons who purchased the securities of a particular company during a specified period of time (the class period)."

A handful of law-firms are known to specialize in this type of litigation including Pomerantz LLP,Grant and Eisenhofer, Steinmeyer Law, and Robbins Geller Rudman & Dowd LLP. Class action securities litigation has been a lucrative field due to large settlements, the largest historic settlements being Enron Corporation at $7,227,390,000, WorldCom, Inc.$6,133,000,000, and Tyco International Ltd.$3,200,000,000.

The ease to prove damages, and thus the ability to garner and drive large settlements, may be tempered by the Halliburton Supreme Court case which allows direct evidence to counter efficient market or Fraud-on-the-market theory.

...
Wikipedia