The New York Law Journal has an article (via law.com – NYLJ subscrip. req’d) on the tendency of law firms to settle litigation brought against them. The article discusses Simpson Thacher & Bartlett’s decision to pay $19.5 million as part of the Global Crossing securities class action settlement. Simpson Thacher was not a named defendant in the case, but had been accused of engaging in an incomplete investigation into certain accounting issues.
Quote of note: “A plaintiff’s lawyer who asked to remain unnamed because he is suing a different law firm in a separate class action said the charges against Simpson Thacher were ‘mushier’ than those brought against other firms in securities actions. It is not clear that Global Crossing’s drop in share price stemmed directly from Simpson’s alleged mishandling of the Olofson investigation, he explained. More typically, lawyers sued are those who helped prepare disclosure statements to the Securities and Exchange Commission and the investing public.”