Securities class actions in the United States rose to their highest level in 20 years and filings targeting European issuers reached record numbers.
In 2016, the 15 filings against European issuers were more than double the 1997–2015 historical average of seven.
Securities Class Action Filings—2016 Year in Review issued by Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse also revealed that for the first time since 2009, European filings outnumbered filings against Chinese issuers, who were the most common targets in 2015.
Filings against firms headquartered in the United Kingdom (six), Germany (four), and Ireland (four) were the highest on record.
“The majority of the European filings were in the Second Circuit, the federal district for New York,” commented Mr Jamie Meehan, senior vice president and head of Cornerstone Research’s European finance practice.
“The pharmaceutical industry was the most heavily targeted with six filings, the only sector that had more than one in 2016.”
Overall, the record 270 federal filings in 2016 - 82 more than in 2015 - was 44 per cent above the historical average. The increase was largely due to 80 filings related to merger and acquisition transactions. Filings against foreign issuers totaled 42 in 2016, second only to 2011, according to the report.
The report can be downloaded from Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse.