The following message was sent to me by LPasko, a (former) class
action attorney that I ran across on another SI thread. While it
was sent to me as a private message, it included his permission
to post it publically. - Rob Preuss.
Rob: I just got your message on the class action lawsuit. Sorry it
took me so long; I am back practicing law part time. I haven't had
a chance yet to look thoroughly at the thread, the press releases,
and whatever there is on the lawsuit. It looks like the way the lawyer
has gone about things has pissed people off. A lot of the problem
stems from the attempt Congress made to "clean up" the class action
profession in 1995. The Private Securities Litigation Reform Act of
1995 requires a lawyer who files a class action suit to advertise it,
and to invite others to join in. The theory was that this would
attract more investor participation in these suits, and thus give
investors more of a voice. Unfortunately, the Act also stated
elsewhere that the lead counsel (who essentially directs all aspects
of the litigation) shall be that lawyer who represents the person who
has the greatest stake in the litigation (that is, the person suing
who lost the most money). Courts have interpreted this to allow
lawyers to accumulate plaintiffs, so that the "group" they represent
is, they hope, one that has larger losses than the person or group any
other lawyer represents.
Thus the "law of unintended consequences" is at work as the provision
Congress enacted to improve class action practice has actually led to
what many investors perceive as "ambulance chasing."
All this has nothing to do with whether the lawsuit here is valid or
invalid. I merely provide this by way of background.
Rob, if you wish, you can post all or any part of my response on the
thread. I have posted this as a Private Message because I did not know
how much of this you wished to keep confidential.
I'll try to get a feel for the situation soon, and get back to you.
If any other questions occur to you in the meantime, let me know.
Good luck. Larry. |
