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Re: Class Action Lawsuits, Record Number of Cases
Chapman, Spira & Carson - Disscusion

From: Stanford University
Date: 4/17/99
Time: 8:26:58 AM
Remote User:


Stanford University has a site which deals with Class Action Lawsuits. As with everything that the University does, it has style and class. If you think that a company has screwed up and should be sued for its errors, check in here and you probably will find a lot of helpful information.

Deutsche Bank is 500th Company Sued in a Federal Securities Fraud Class Action Since Congress Enacted Reform in 1995 ___

Litigation on Pace to Hit Record in 1998 ___

Stanford, Ca., Dec. 14, 1998. Deutsche Bank recently became the 500th company named in a federal class action securities fraud complaint since Congress passed the Private Securities Litigation Reform Act of 1995.

Deutsche Bank's status as the 500th corporate defendant was determined according to a census maintained by Stanford Law School's Securities Action Clearinghouse, which can be viewed at

The complaint alleges that Deutsche Bank falsely denied its participation in "takeover talks" with Bankers' Trust. These denials were allegedly intended to allow Deutsche Bank to acquire Bankers' Trust shares at a lower price. The full text of the Deutsche Bank complaint can be viewed at

"Deutsche Bank's status as the 500th corporate defendant since the Reform Act, and the fact we've hit number 500 in calendar 1998, is quite significant," according to Stanford Law School Professor Joseph A. Grundfest, a former Commissioner of the U.S. Securities and Exchange Commission, who directs the Clearinghouse project. "It's significant for three distinct reasons," he added.

"First, the census hit 500 so soon after the Reform only because companies have recently been sued at the record pace of about 19 per month. If litigation continues at this pace, we are on track to see about 233 companies sued in 1998. That would break the prior record of 227 suits filed in 1994. Proponents of reform who thought it would reduce the number of companies sued are therefore likely to be disappointed by the effects of reform to date."

"Second, foreign companies frequently complain about litigation in the United States. Many assert that they don't want to list their shares on the New York Stock Exchange or on the Nasdaq market because of litigation fears. This lawsuit will, unfortunately, only feed those concerns."

"Third, this is precisely the sort of litigation likely to perplex foreign managements. Deutsche Bank is almost certain to claim that none of its statements were false and that it was acting in shareholders' best interests by not prematurely disclosing information that could have killed a deal beneficial to both Deutsche Bank and Bankers' Trust shareholders. They are likely to be disappointed that much of the litigation could well turn on a technical parsing of newspaper quotations, and that the law may not, depending on the circumstances, give management much credit for any good faith efforts to enhance shareholder value."

The addition of the Deutsche Bank complaint also comes on the second anniversary of the founding of the Stanford Securities Class Action Clearinghouse. The Clearinghouse is the world's first Designated Internet Site, as defined by federal court rule and recognized by the U.S. Securities and Exchange Commission, for the required Internet posting of certain litigation documents.

In an October 1998 report, Congress urged other federal courts to "adopt rules, similar to those in effect in the Northern District of California, to facilitate maintenance of this and similar data bases."

The online database, which is maintained by the staff of the Stanford Law Library, now contains over 4,000 documents related to securities class action fraud litigation, all available as a public service, and has registered subscribers with more than $2 trillion of assets under management.


CONTACT: Paul Lomio at (650) 725-0804 or Erika Wayne at (650) 723-2471.

Last changed: March 17, 2000