Combine the prospect of making a fortune with an
insidious mix of political influence and campaign finance,
and the results too often are abuses of the federal and state court systems
that are much too common in class-action securities litigation. A new study from the U.S.
Chamber Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce, on “frequent filers” shines much-needed light on a serious problem
that cheats plaintiffs of just compensation while enriching trial lawyers
and encouraging excessive and unnecessary litigation.
Frequent filers are trial lawyers who repeatedly file
class-action securities lawsuits, often against Fortune 500 corporations,
knowing that the mere threat of extended litigation and negative public
relations is frequently sufficient to generate out-of-court settlements,
including extremely lucrative legal fees. At the federal level, these lawsuits
are often filed on behalf of public employee and union pension and retirement funds seeking
to stay ahead of exploding benefit obligations. At the state level, the
litigation more often arises from merger and acquisitions and shareholder
derivative issues.
The problem is especially acute at the state level.....To Read More......
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