Institutional Investors As Class Representatives

Law360, New York (November 23, 2009, 1:25 PM EST) -- In 1995, Congress passed the Private Securities Litigation Reform Act (the “Reform Act”) with the goal of curbing a variety of abusive practices in securities class actions.[1]

Many of these abuses were thought to be the result of “lawyer-driven” litigation where cases often proceeded with a nominal investor plaintiff who lacked the ability or motivation to be an active participant.[2]

It was the view of Congress that the plaintiffs’ lawyers typically chose the client, not the other way around, and that led to the use of...
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