Securities Class Actions Take Fresh Look At 'Stale Claims'

Securities Class Actions Take Fresh Look At 'Stale Claims' - 7/6/2009 , Class Action News, Class Action, Securities News, shareholder class action, claim, litigation, securities action, common stock'>

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Securities Class Actions Take Fresh Look At 'Stale Claims', Litigation Focus Shifts To Targets Other Than Financial Institutions
Roberto Ceniceros

Business Insurance. July 6, 2009
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EXCERPT: Plaintiffs are looking to the past to find material on which to file class action securities lawsuits, according to sources that track filings. Within recent months, plaintiffs filed lawsuits with class dates going back to 2007. Waiting nearly two years after an alleged class period has ended to file an action is very rare, as plaintiffs attorneys typically rush to be the first to represent a class, several legal experts said. “It’s definitely unusual to reach back so far,” agreed Renee L. Siemens, a partner and directors and officers liability expert representing policyholders at Proskauer Rose L.L.P. in Los Angeles. While there have been only a few cases filed this year against the directors and officers of nonfinancial services companies on behalf of 2007 investor classes, some experts said they expect to see more because many banks and other financial entities that became preferred targets after the onset of the financial crises already have been sued. That has left plaintiffs attorneys to look for new targets other than banks, subprime lenders or Bernard Madoff-related companies to sue, they added. But with the stock market’s recent performance, in which most companies have lost substantial value, it is difficult to allege directors and officers are responsible for a company’s more recent stock decline, they added. “I subscribe to the theory these guys have been so busy on the (financial institution) side that now they are going to start going back and looking at what other cases they have (previously) looked at, but did not act on,” said Evan J. Rosenberg, senior vp for Chubb Specialty Insurance in Warren, N.J. “So I do think there will be an increase in D&O lawsuits against commercial (nonfinancial) enterprises in 2009 and 2010.”

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