A recent paper by Cheng, Srinivasan, and Yu of the Harvard Business School found that U.S. listed foreign companies experienced about half the class action lawsuits as their U.S. counterparts. (SSRN) Here’s the abstract: We study securities litigation risk faced by foreign firms listed on U.S. exchanges. We find that U.S. listed foreign companies experience…
Finra has published guidance for Investment Advisors at non-member firms who wish to utilize the Finra Dispute Resolutions platform. (Finra) You can see our previous coverage of this here. The full text is below: FINRA Dispute Resolution has received inquiries from lawyers who represent investors and those who represent investment advisers (IAs) which are not…
The International Comparative Legal Guide recently released a study by NERA on international class actions. The bottom line: despite the Morrison decision, international class action suits are on the rise – primarily because of China. (ICLG)
Bruce Kelly, of InvestmentNews, reports that Finra will soon open its dispute resolution arbitration platform to registered investment advisors. (IN) This is good news for RIA investors because those arbitrations have typically been heard in AAA or JAMS forums, which are much more expensive. RIA firms may also welcome the lower costs. Finra Dispute Resolution…
DSNews reports that five Alabama homeowners are acting as lead plaintiffs in a Libor class action. They owned ARMs linked to the Libor and claim to have been damaged in the $1,000 range. The plaintiffs attorneys estimate the class could grow to over 100,000. (DSN) Also see an FT article on the same topic. (FT)…
Below is a visualization of annual Finra Arbitration Filings as compared to the S&P 500 annual closing value. Since 1999, there is a significant negative correlation of -0.594 between the two. When arbitration filings have peaked it has been a buy signal, and vice versa. On the lower pane of the viz, I have plotted…
I came across this PriceWaterhouse Coopers study on securities litigation. Some nice insights on trends in filings. (PwC)
The latest liability estimate for the Libor scandal is in at $6 billion for municipal bonds, writes Darrell Preston of Bloomberg. (Bloomberg) The estimate comes from Swap Financial Group. The size of the muni swap market is estimated to be about $500 billion, so the $6 billion estimate comes in at 1.2 percent.
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