Plaintiffs' Firm Success Hinges on Bringing Right Cases

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By Michael Greene

June 10 — The plaintiffs' firms that are the most successful in securities class actions have one thing in common: they pick the right cases up-front.

Spending extra effort on the front end to evaluate cases before accepting the responsibility of serving as class counsel is critically important, Darren Robbins, a founding partner at Robbins Geller Rudman & Dowd LLP, told Bloomberg BNA.

A successful civil action requires not only establishing defendants’ misconduct, but providing a sensible path to recovery for clients, Robbins said. “We are acutely sensitive to this reality and utilize teams of investigators, former prosecutors and forensic accountants to delve into, assess and formulate potential claims.”

The strategy has paid off for the firm. Robbins Geller was the top in 2015 in representing clients in securities class actions, recovering more than $1.5 billion in approved settlements, according to a report by Institutional Shareholder Services Securities Class Action Services LLC.

Darren Check, a partner at Kessler Topaz Meltzer & Check LLP—another firm that made ISS's top 10—said it's a matter of having quality lawyers that can evaluate and investigate claims early to find out as much as possible so that the firm knows what it is getting into.

Until a lawsuit clears the motion-to-dismiss stage, plaintiffs can't get discovery and are investigating potential corporate fraud based primarily on what's publicly available, he said.

Settlement Amounts Up

Federal securities class actions can be extremely lucrative for plaintiffs' attorneys, who generally are paid from the money they recover for clients.

According to a Cornerstone Research report, 80 securities class action settlements were approved in 2015, the highest number since 2010 (61 CARE, 3/30/16). The report also found that total settlement dollars rose to more than $3 billion last year—a 184 percent increase from 2014's historic low, and an increase compared to the annual average of $2.8 billion over the last five years.

Meanwhile, the number of cases continues to climb. Last year, securities class lawsuits hit a seven-year high with 234 complaints filed, the highest number since the financial crisis, a National Economic Research Associates Inc. report found (17 CARE, 1/27/16).

In 2015, four plaintiffs' firms obtained over $500 million in settlements for their clients in cases in which they served as lead or co-lead counsel, according to the ISS report, which ranked the top firms in terms of settlement amounts.

After Robbins Geller, the other top firms were Bernstein Litowitz Berger & Grossmann LLP, Barrack, Rodos & Bacine, and Miller Law Firm. Kessler Topaz was seventh.

While finding the right case is paramount, plaintiffs' attorneys told Bloomberg BNA that that can take a significant toll on the firm's resources.

Michael Stocker, a partner at Labaton Sucharow LLP, said his firm spends an enormous amount of time performing due diligence on claims before recommending them to clients. “This can require a substantial outlay of resources, including retaining industry experts and analyzing enormous amounts of data,” he told Bloomberg BNA in an e-mail.

Labaton Sucharow was eighth on ISS's list.

Other Qualities

In addition to picking the right claims, a successful firm is defined by integrity, character and hard work, Robbins said. “You can’t have a successful plaintiffs’ firm if you are not willing to put your money where your mouth is,” he said. “You have to go all in, not test the waters.”

At the same time, securities fraud is constantly evolving. Stocker stressed that to stay successful, firms have to educate themselves on new trends in the markets, whether it’s cybersecurity or high-frequency trading.

“This makes the practice very different from something like contract law, where fact patterns and legal authority are relatively static,” he said.

Firms also must adapt to the increasing globalization of securities litigation.

There are securities cases being litigated all over the world as investors' portfolios become more global, said Check, whose practice includes working with many types of institutional investors in corporate fraud cases. The firms that have been really successful are the ones that understand how to diversify their practice to best serve their clients' needs, he said.

Moreover, firms must show they understand the business and market environment as well as the law, Stocker said. He noted that the firms that really distinguish themselves in a competitive environment are the ones that are prepared to advocate for investor interests outside of the courtroom—especially in the media.


It is no easy ride for plaintiffs' attorneys, who face a myriad of challenges, not least of which is competition from other plaintiffs' firms. They said they also have to fight the influence of lobbyists and business groups on Capitol Hill, and cope with the high vacancy of district court judges, which leads to delays in case resolution.

Moreover, defendant corporations frequently are well-funded and represented by the nation's top law firms. Stocker said Labaton Sucharow's attorneys work hard to “even the playing field” when they litigate against big defense firms.

“Defendants are often their own best industry experts—they already understand the business they are in.” Stocker said. “When we litigate a case in a sector unfamiliar to us, we work with top industry experts to make sure we are at no disadvantage. This can be critical to your case when dealing with fraud claims relating to the pharmaceutical sector or asset-backed securities, as we often do.”

Meanwhile, some firms measure success in ways other than winning a high-dollar settlement in a large securities case.

Stocker said his firm pursues smaller actions that it thinks can expand the law to better protect investors.

Robbins similarly said success isn't always measured in terms of dollars and cents. He said his firm over the years has dedicated time, energy, and the full range of its resources for many pro bono and charitable actions that aren't related to securities fraud. “We work hard to be good citizens who give back to the communities we live and work in,” he said.

To contact the reporter on this story: Michael Greene in Washington at

To contact the editor responsible for this story: Yin Wilczek at

For More Information

The ISS report is available at