New ILR Research Offers Solutions to the “Broken” Securities Litigation System

A new research paper prepared by Mayer Brown LLP Partner Andrew Pincus and released by the U.S. Chamber Institute for Legal Reform (ILR) offers “proposals to reform the broken securities class action system.”

The paper, called “Containing the Contagion,” calls on both Congress and the U.S. Securities and Exchange Commission to adopt new policies to curb abuse of the securities litigation system, which has seen record high lawsuit filings in recent years. The paper calls on Congress to enact an “Investors’ Bill of Rights” to return the power in the litigation arena back to investors and away from lawyers and close loopholes in the Private Securities Litigation Reform Act of 1995 that have allowed plaintiffs’ lawyers to work around the law.

Kevin LaCroix, who moderated a panel at an ILR event with the paper’s author, said in his post on D&O Diary that “the statistics surrounding securities class action litigation have been growing at an alarming rate, which at least [may] potentially be sufficient to galvanize even a divided Congress into action.”