Though intended to be a check against bad behavior from public corporations, securities fraud class action lawsuits are becoming a simple game of chance for the plaintiffs’ bar. Some plaintiffs’ lawyers are partnering with individual shareholders to target large companies with numerous class actions on frequently weak merits, weighing the comparatively low costs of filing suit against the potential for “mega-settlements.” By identifying cases with “mega-settlement” potential, and winning the right to serve as lead counsel in those cases, plaintiffs’ firms are turning what is meant to be a valuable corrective mechanism in the American legal system into yet another lawsuit income stream.

View PDF