This chapter, written for the Research Handbook on Shareholder Litigation, surveys empirical work studying the lead plaintiff provision of the Private Securities Litigation Reform Act (PSLRA). That work finds that the lead plaintiff provision has encouraged institutional investors to participate in securities class actions and that those institutional investors have negotiated lower attorneys' fees. Those benefits from the lead plaintiff provision are undercut, however, by political contributions made by plaintiffs' lawyers. We suggest additional reforms to promote transparency and competition among lawyers for lead plaintiffs. We also suggest reforms to the lead plaintiff provision intended to enhance the screening effect of the PSLRA.
Law | Law and Economics | Litigation | Securities Law
Date of this Version
Working Paper Citation
Pritchard, Adam C. and Choi, Stephen, "Lead Plaintiffs and Their Lawyers: Mission Accomplished, or More to Be Done?" (2017). Law & Economics Working Papers. 130.
This is a pre-publication. The final publisher's version may be found as Pritchard, Adam C. "Lead Plaintiffs and Their Lawyers: Mission Accomplished, or More to Be Done?" S. J. Choi, co-author. In Research Handbook on Shareholder Litigation, edited by J Erickson et al., 271-86. Research Handbooks in Corporate Law and Governance. Cheltenham, UK: Elgar, 2018. DOI: https://doi.org/10.4337/9781786435347.00030