NERA Economic Consulting and Cornerstone Research have released their respective 2024 annual reports on federal securities class action filings. As usual, the different methodologies employed by the two organizations have led to slightly different numbers, although they both identify the same general trends.
The findings for 2024 include:
- The reports agree that overall filings have stayed steady. NERA finds that there were 229 filings (matching the number of filings in 2023), while Cornerstone finds that there were 225 filings (compared with 215 filings in 2023). Filings involving only Section 10(b)/Rule 10b-5 claims for securities fraud are an increasing percentage of the overall filings. Cornerstone found that 198 of the 225 filings fit this description, the highest level on record. Relatedly, Cornerstone found that the number of federal and state 1933 Act filings decreased from 64 filings in 2022 to 32 filings in 2023 to 21 filings in 2024.
- NERA found that filings against companies in the technology and healthcare sectors combined accounted for more than half of all filings, and the Second and Ninth Circuits accounted for 61% of filings (excluding merger objections and crypto unregistered securities cases).
- Both reports agree that filings involving artificial intelligence (AI) claims are the fastest growing category. NERA and Cornerstone found that filings with AI-related claims more than doubled from 2023 to 2024 (NERA – 13 filings, Cornerstone – 15 filings).
- NERA found that after excluding cases involving merger objections, crypto unregistered securities, or settlements of $0 to the class, around 42% of settlements had a recovery of less than $10 million, another 40% had a settlement between $10 million and $49.9 million, and 18% settled for $50 million or more, largely mirroring the distribution of settlement values from 2023. The average settlement value in 2024 was $43 million, a roughly 7% decline relative to the 2023 inflation-adjusted average settlement value of $46 million.
The NERA report can be found here. The Cornerstone report can be found here.
The 10b-5 Daily 