Cornerstone Research (in conjunction with the Stanford Securities Class Action Clearinghouse) has issued its 2015 midyear report on securities class action filings.
The findings for the first half of 2015 include:
(1) There were 85 new filings, which is a slight increase over the first half of 2014 (but still lagging behind the semiannual average of 94 filings).
(2) Foreign companies were a significant percentage of the new filings, with 20 filings (i.e., 24 percent of the total) being brought against companies headquartered outside the United States.
(3) Filing activity in the technology industry has increased, leading to a surge in filings in the Ninth Circuit (nearly double when compared with the second half of 2014).
(4) Companies with large market capitalizations continue to face fewer filings than in the past. On an annualized basis, only 1.6% of S&P 500 companies were the subject of securities class actions in the first half of 2015.
Quote of note (Professor Grundfest – Stanford): “Securities class actions continue to percolate at a relatively low level, whether measured by the number of cases filed or the dollar amounts at stake. The interesting question is ‘why?’ Some observers point to high stock price valuations and the lack of volatility in equity markets. Others point to the fact that many of the major accounting scandals now appear to be happening abroad. A combination of both factors could well be at work.”