Two interesting articles:
(1) In a legal system that permits contingency fee arrangements, it is axiomatic that big settlements lead to big attorney fee awards. The New York Sun has an article on the attorney fee arrangement in the Enron securities class action, which could lead to a record $1 billion payout for the lead counsel in the case.
(2) The 10b-5 Daily has frequently discussed the potential impact of Rule 10b5-1 stock trading plans on securities class actions. The Los Angeles Times has an article (free regist. req’d) on a forthcoming Stanford University study finding that corporate insiders with stock trading plans “initiated 10.4% of their stock sales before a negative earnings report that would send share prices lower” as compared to “5.2% of the time in advance of positive earnings news.” The author of the study speculates that executives may be manipulating the timing of the release of corporate news that could effect their stock sales. The article also notes that relatively few companies disclose the existence or terms of their executives’ trading plans.