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Securities Class Actions & ERISA Litigation

The Brattle Group provides expert testimony and consulting support in all phases of securities class actions, including Rule 10b-5, Section 11 and 12, and ERISA matters, from pre-litigation to distribution of settlements. Our Principals and affiliated experts have extensive experience with analyses of loss causation, market efficiency, and trading behavior, supporting successful arguments related to class certification and damages, including trial and summary judgments in the United States, Australia, Canada, and Europe.

At the class certification phase, we assist our clients in determining if securities were traded in an efficient market, whether there is evidence of price impact, and the extent of conflicts among class members. Using proven arguments and innovative approaches to evaluate per-share damages scenarios and alternative trading models to determine investors’ trading activity, we assist our clients with the assessment of potential aggregate damages and model potential settlement scenarios, relying on rigorous academic research on the principles of security price formation. We also address issues related to financial econometrics and apply data analytics skills to complex individual-level transaction datasets.

Brattle experts perform a range of analyses critical to securities class actions, including:

  • Evaluating class certification arguments about market efficiency;
  • Examining alleged misstatements and omissions to establish loss causation and corrective disclosures;
  • Performing event studies to measure potential inflation and price impact;
  • Estimating potential damages in securities class actions using trading models; and
  • Examining trading behavior by individual and institutional investors.

We serve clients in a variety of industries, including energy, financial institutions, construction and manufacturing, healthcare and pharmaceuticals, and technology.

ERISA Litigation

Employee Retirement Income Security Act (ERISA) litigation commonly arises when employee benefit plans suffer market-induced losses. Brattle delivers expert testimony and consulting support, including working papers and research reports, in a variety of ERISA and pension plan litigation matters, including the two major types of plans: defined benefit plans and defined contribution plans (for example, 401(k)s and IRA accounts). Brattle’s clients in this sector range from plan fiduciaries, administrators, and trustees, to external investment consultants for defined benefit plans, company benefits committees, and the Pension Benefits Guaranty Corporation.

Our team of internal and external experts performs a range of analyses including:

  • Evaluating reasonableness of company stock holdings in 401(k) plans;
  • Examining the overall soundness of defined benefit plan trustees’ investment strategies;
  • Assessing compliance of plan fiduciaries, administrators and auditors with industry standards and customs;
  • Researching the appropriate discount rate to apply to unfunded pension liabilities;
  • Evaluating allegations of sham transactions to avoid pension liability;
  • Analyzing “pension puts”;
  • Estimating damages in ERISA class action suits arising from alleged over-concentration in employer stock and general mis-allocation of funds; and
  • Examining alleged age discrimination in cash balance pension plans.


Below is a list of representative engagements for our Securities Class Actions & ERISA Litigation practice.

Impact of accounting misstatements
In litigation involving a privately held software company being acquired in a stock transaction by a larger, publicly held software company, we calculated economic damages as a result of the acquisition being transacted at an artificially inflated stock price. The defendant, a large public accounting firm, was alleged to have failed in its duties to the public markets because of disregard for Generally Accepted Auditing Standards (GAAS), Generally Accepted Accounting Principles (GAAP), and other misrepresentations. Our analysis estimated the impact that specific accounting misstatements had on auditing negligence on the public accounting firm's part, and calculated the relevant stock price “but for” these misstatements.
Materiality of inventory overstatements
The Brattle Group analyzed the financial impact of inventory overstatements in a securities fraud case in the health care industry. Our analysis demonstrated that inventory misstatements were an inconsequential part of the overall scheme of the fraud, and that they did not cause material artificial inflation in the stock price or material damage to shareholders.
Damages estimation
In securities litigation for a national managed care provider, we analyzed economic loss causation, modeled various damage scenarios, and provided a critique of the defendant’s expert reports. Our work assisted counsel for the class in preparing for settlement negotiations. The case settled for $300 million.
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