Encyclopedia of Law and Economics

2019 Edition
| Editors: Alain Marciano, Giovanni Battista Ramello

Securities Class Action

  • Lucia dalla PellegrinaEmail author
  • Margherita Saraceno
Reference work entry
DOI: https://doi.org/10.1007/978-1-4614-7753-2_729

Definition

Securities class actions (SCAs) are lawsuits brought before a court on behalf of a group of investors, whose rights have allegedly been violated by the company in which they have a stake. Usually, allegations concern the fact that the company and some of its officers violated federal or state securities laws. In this article, we overview the procedural characteristics of SCAs in the USA and other countries that have established this type of legal remedy, discussing their role as compensation, deterrence, market regulation, and corporate governance tools.

Introduction

This article overviews the main features of securities class actions (SCAs, hereafter), both in the USA and in other countries, discussing their role as compensation, deterrence, market regulation, and corporate governance tools. Relying on empirical contributions that investigated the relationship between the event of an SCA and target companies’ behavior, this contribution supports the view according to which...

Keywords

K41 K22 JEL Classification Securities class action Compensation Deterrence Ex-post regulation Corporate governance 
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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.DEMSUniversity of Milano-Bicocca and BAFFI CAREFIN Centre, Università BocconiMilanItaly