Cornerstone Research has released its annual report on securities class action settlements. The notable findings include:
1) There were 103 settlements in 2009. The aggregate value of those settlements was $3.8 billion (a 35% increase over 2008).
(2) The average settlement amount was $37 million. Although this number is a significant increase over the 2008 average ($28.4 million), it is only slightly higher than the historical average of $34.4 million for cases settled from 1996 through 2008 (excluding the top four settlements).
(3) Since 1996, almost 60% of cases settle for less than $10 million and 80% settle for less than $25 million. The distribution of settlements in 2009 follows this same pattern.
The press release accompanying the report can be found here.
Quote of note (PR – Professor Grundfest): “The classic litigation risk factors continue to run true to form. If a lawsuit is prosecuted by a large pension fund, involves a parallel SEC proceeding, and alleges accounting violations, then defendants can be expected to pay higher amounts.”