Removal of class actions filed in state court alleging federal securities law violations

Purpose - The purpose of this paper is to survey the landscape of recent federal securities class actions filed in state court and explore arguments for removal of those cases to federal courts under the Securities Litigation Reform Act (SLUSA) or the Class Action Fairness Act (CAFA).Design methodol...

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Bibliographic Details
Published in:The journal of investment compliance 2008-11, Vol.9 (4), p.68-78
Main Authors: Jacobs, Caryn, Strauss, Jeffrey M, Tharp, John J, Agonis, Katherine
Format: Article
Language:English
Subjects:
Bank mergers
Breach of contract
Breach of trust
Citizenship
Class action lawsuits
Class actions (Civil procedure)
Federal courts
Financial control
Fraud
Jurisdiction
Political aspects
Provisions
Securities
State court decisions
State courts
Studies
Supreme Court decisions
Supreme courts
Surveys
United States of America
Violations
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Summary:Purpose - The purpose of this paper is to survey the landscape of recent federal securities class actions filed in state court and explore arguments for removal of those cases to federal courts under the Securities Litigation Reform Act (SLUSA) or the Class Action Fairness Act (CAFA).Design methodology approach - The paper discusses: US Congressional legislation designed to bring the bulk of securities class actions back into federal courts, including the Private Securities Litigation Reform Act (PSLRA) and SLUSA; CAFA, another law designed to redirect class action litigation away from state courts; recent cases that have tested the limits of SLUSA and CAFA for removal from state to federal courts; and arguments for removal under SLUSA and CAFA.Findings - Legislative history for both SLUSA and CAFA suggests that these statutes should be read as evidence of Congressional intent to return most securities class actions to federal court. Nonetheless, plaintiffs have continued to devise legal schemes to litigate class actions in what they perceive to be friendlier forums in state courts.Originality value - Although the arguments discussed in this paper are not exhaustive, they are a starting point for defendants seeking removal once litigation arises.
ISSN:1528-5812
1758-7476
DOI:10.1108/15285810810922288