This content is from: Innovation
Fewer Investors Opt To Take The Money And Run
It used to be that big companies slapped with huge securities class actions would make their legal troubles go away by offering a generous settlement.
"Why should investors sit passively by and take a couple of cents on a the dollar," famed securities plaintiffs' lawyer William Lerach of the San Diego law firm Lerach Coughlin Stoia Geller Rudman & Robbins said in the Business Week article. "This is an extraordinarily powerful tactical weapon."
Extraordinary, maybe. But it's not for the faint-hearted or shallow-pocketed, which is why investors like Janus could chance it. In a class action, fees charges are spread over a larger group of people, and the final reward –either through settlement or victory – tends to be larger but spread out over the group. An investor that chooses to go it alone in litigation, however, may reap a higher reward or nothing at all – on top of massive expenses.