Kevin LaCroix reports that:
In her article entitled “Securities Class Action Lawsuits in State Court” (here), Lewis & Clark Law School ProfessorJennifer Johnson examines a database of class actions filed in state court between 1996 and 2010. Her analysis shows that as a result of several Congressional enactments in recent years – particularly SLUSA and CAFA – the prevalence of many types of state court securities class action filings has declined. However, the number of state court class action lawsuit filings involving M&A transactions has been “skyrocketing” and now even outnumber federal securities class action lawsuit filings.
Indeed given that the database of state court filings on which Professor Johnson relied almost certainly understates the number of state court filings, it is probable that the number by which the state court M&A-filings exceeds the number of federal court filings is even greater than her analysis shows.
After describing the phenomenon at some length, LaCroix turns to an insightful analysis of the policy issues posed by these developments. recommended reading.