Investors often contact us at Silver Law Group when they learn that they may qualify to participate in a class action lawsuit regarding securities they own or previously owned. Many of these investors wonder about the length of a securities fraud class action case.
How long it takes to resolve a securities fraud case depends on multiple factors, many of them out of the control of the attorneys handling the lawsuit. Although it’s impossible to predict with certainty, the time from initiation of the lawsuit to distribution of a settlement or verdict can take several years.
Securities fraud class action cases are procedurally different than other class actions. 15 United States Code § 78u-4(3)(A)(i) requires that when a plaintiff files a lawsuit alleging securities fraud, they must publish a notice of their claim in a national publication within 20 days.
Within 60 days of the publication date, other individuals with similar claims must submit applications to be lead plaintiff, and the court must consider the lead plaintiff petitions within 90 days of the publication date. It could be four months or more from the date the first suit was filed before the court names a lead plaintiff and consolidates the filed cases.
Typically, the defendants in the case will file a motion to dismiss the case as lacking merit, and the plaintiffs will file a response to the motion. Federal law does not set a timeline for the judge’s decision on the motion to dismiss. Sometimes months or even a year elapses before a judge decides on the motion to dismiss. Silver Law Group has no control over the timing of a judge’s ruling on motions, but the firm will keep you informed of progress on the case.
When the judge’s ruling allows the suit to move forward, the discovery phase of the trial commences. Discovery is the process where each side seeks evidence and information from the other side to help prove their case.
The defendants’ attorneys will look for information showing that the plaintiffs do not have similar claims. A lawsuit can only proceed as a class action if the plaintiffs’ losses arise from the same circumstances. The plaintiffs’ lawyers will look for evidence of corporate misconduct or market manipulation.
The discovery process is often lengthy, and when one side discovers new information, it may lead them into other avenues of investigation. It is common for both sides to bring multiple motions during discovery, and the discovery phase in a securities fraud lawsuit can last for a year or more.
The law sets a class period for class action securities fraud lawsuits. Anyone who owned or traded specific securities during the class period is automatically included in the class action. Sometimes the class period changes as plaintiffs’ attorneys encounter new information.
The class period is the time during which an investor might have purchased a specific stock due to the influence of inaccurate or misleading information, market manipulation, or similar misconduct. The class period typically begins when the company or its promoters commit misconduct, and ends when the misconduct is exposed or corrected.
The class period can encompass several months or could extend a year or more. The longer the class period, the more potential plaintiffs there may be. However, a larger pool of plaintiffs can slow the resolution of a securities class action lawsuit.
Participating in a class action securities lawsuit can provide the opportunity to recoup at least some of your losses, but it will likely be several years before you receive a check.
When you work with Silver Law Group, you can be assured of regular updates about the progress of your case. Get in touch with our team today.
