The New York Times reported an increase in federal class-action securities suits in 2013, compared to the prior year. According to a study from Cornerstone Research and Standford Law School, Plaintiffs filed 166 suits in 2013, up 9 percent compared to the 152 actions filed in 2012.
The Times speculates that “fewer companies on the New York Stock Exchange and the NASDAQ mean fewer companies to target.”
Notably, while the number of cases increased, the total damages sought by the 2013 suits was the lowest since 1998:
While the amount of cases increases slightly last year, the amount of money at stake shrank drastically. In 2013, Cornerstone estimated that all the suits combined could award as much as $279 billion to plaintiffs, the lowest level since 1998. That represents a 31 percent drop from 2012 levels, and a 57 percent drop from the historical average.
The Times quoted Joe Grundfest, a professor at Standford, who stated that “In a rising market, you simply don’t have losses that are as large.”