In an “Insight Alert,” attorneys from King & Spalding look into recent developments in securities litigation defense and suggest a new strategy may be emerging.
Securities litigation filings have continued their record pace throughout the year, which has largely been driven by merger and acquisition lawsuits. Warren Pope, Bethany M. Rezek, and Brian Barnes say that “litigating these nuisance claims” may now be a legitimate option, as opposed to a settlement. They point to a recent case involving Triangle Capital Corporation, in which the defendant successfully litigated the lawsuit and kept the merger on schedule.
Pope, Rezek, and Barnes say the key lesson from that case is to “consider whether the more prudent approach is to defend” the lawsuit rather than “merely perpetuating in federal court the disclosure-only settlement practice.”