For institutional investors, the idea of recovering losses through securities litigation outside the United States has long carried a sense of uncertainty. The United States, with its robust class action system and the opportunity for investors to sit on the sidelines of litigation while still benefiting from recoveries, make the United States the most active jurisdiction relied upon by investors to compensate for corporate and accounting irregularities as well as misstatements. For decades, with billions in recoveries available to investors every year, there was no need for investors to seek recovery outside of the United States.
That changed in 2010, when the decision by the U.S. Supreme Court in Morrison v. National Australia Bank changed the landscape and limited U.S. jurisdiction to securities traded domestically. Investors were suddenly forced to seek compensation in securities not traded in the U.S. in those jurisdictions where those shares were traded. Initially, concerns about procedural hurdles, weak enforcement, protracted timelines, and uncertain recoveries have often led many to assume that non-U.S. class actions are more trouble than they are worth.
That perception has been changing fast. Over the past few years, legal reforms, high-profile case resolutions, and more investor activism have created a landscape in which recoveries in Europe, Asia, and elsewhere are not only possible, but increasingly practical and material. This article charts that evolution, illustrates real success stories, and offers insights for investors who should no longer treat non-U.S. litigation as optional. In fact, there are currently over fifty ongoing litigations in jurisdictions outside of the United States.
Read the full ‘Thought Leadership’ article at the link below
