Big plaintiffs, such as institutional investors, have helped increase the median size of securities class action settlements by 19%, according to Cornerstorne Research. The Washington, D.C.-based firm, which co-sponsored the Stanford Law School Securities Class Action Clearinghouse, says that the median settlement last year was more than $7.5 billion, compared with $6.3 billion in 2004 – believed to be the largest single-year increase, according Dr. Laura Simmons, who authored the study.
Cornerstone also found that the total value of the securities class actions settlements grew 17% to $3.5 billion, up from $2.9 billion, with more cases settled (124 vs. 113). The report said that institutional investors were associated with 35% of the settlements in 2005, compared with 20% in 2004, and that 40% of the cases involved restatement of financial statements, nearly double from the year before.