On April 8, 2010, the Wall Street Journal ran an article under the headline “Banks Winning When Investors Sue.” However, that article only told part of the story.
According to Craig T. Jones, a lawyer who represents investors at the Atlanta law firm of Page Perry LLC, “the Journal article was focused on lawsuits filed in court, primarily class actions in federal court. But the vast majority of individual investors who make claims against banks and broker-dealers do so in arbitration, and investors have won a higher percentage of securities arbitrations over the past year than they have in years past.” Jones, whose firm handles investment fraud cases all over the country, points out that recent changes in federal law have made it more difficult to sue in federal court, and class action reform legislation over the last several years has made it tougher for investors to bring such cases. “Big class actions get a lot of press,” says Jones, “and a disproportionate number of those have been thrown out on technical grounds due to new procedural requirements, but getting a case thrown out on a technicality should not be taken as a vindication of the banking industry for the abuses that led up to the financial crisis.”
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