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Securities Class Actions

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.

Engagements
REPRESENTATIVE ENGAGEMENTS

Below is a list of representative engagements for our Securities Class Actions 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.
Experts
Principals
Academic Advisor & Other Outside Experts
Torben G. Andersen
Academic Advisor
Northwestern University
View Bio
Michael A. Goldstein
Academic Advisor
Babson College
View Bio
Michael Klausner
Outside Expert
Stanford Law School
View Bio
John J. McConnell
Outside Expert
Purdue University, Krannert Graduate School of Management
View Bio
Paul Pfleiderer
Outside Expert
Stanford Graduate School of Business
View Bio
Senior Associates
Publications
Article
Recent Outperformance of Passive Investment Funds Has Provided a Rationale for Some ERISA Retirement Investors to Cry Foul. Is There a Case for Active Management?
February 27, 2019
Published in Wolters Kluwer Dailies
Article
How Blockchain Could Rescue 10b-5 Damages
August 24, 2018
George S. Oldfield, Angela Lam, and Ethan Moore
Published in Law360

The article discusses the potential use of a blockchain-based recording system in solving 10b-5 damages allocation issues. 

Article
Securities Class Actions: Trading Models to Estimate Individual Investor Trading Activity and Aggregate Damages
May 2017
Published by The Brattle Group, Inc.
Article
The Bid-Ask Spread in the Danish Stock Market: Evidence from the 1990s
August 25, 2016
Published in the International Journal of Economics and Finance

The paper investigates the cost components of the bid-ask spread and the changes in the spread around earnings announcements on the small Danish stock market in the 1990s.

Article
Private Class Action Litigation Risk of Chinese Firms Listed in the U.S.
June 01, 2016
Torben Voetmann, Jan Jindra, and Ralph A. Walking
Published in the Quarterly Journal of Finance
Article
Correct Application of Event Studies in Securities Litigation
December 17, 2015
Pavitra Kumar and Torben Voetmann
Published in Event Study Tools
Presentation
High-Frequency Trading in Litigation
March 26, 2015
Paul Hinton, Pavitra Kumar, and Lauren J. Schreur
Presented to The Knowledge Group
Article
High-Frequency Trading Litigation Presents Complex Issues for Experts
June 2014
Zachary Ziliak, Pavitra Kumar, and Torben Voetmann
Published by The Brattle Group, Inc. Published on Law360
Article
What Makes Securities Class Actions with Accounting Allegations Different?
2011
Elaine Harwood, Adoria Lim, and Laura Simmons
Published by the American Bar Association
News & Knowledge
May 19, 2020
Brattle Experts to Discuss Economic Analysis in Antitrust, Consumer, and Securities Class Actions During CBA Webinar

Brattle Principals Armando Levy, Lisa Cameron, and Matt Aharonian will join a Chicago Bar Association (CBA) webinar to discuss “Economic Analysis in Antitrust, Consumer and Securities Class Actions,” which will take place on May 19 at 12:00 p.m. (PT)/2:00 p.m. (CT)/3:00 p.m. (ET).

May 11, 2020
Brattle Experts Author Article on Quantitative Materiality Assessment Methods

Brattle Principal Bin Zhou, Associate Adrienna Huffman, and Senior Associate Chi Cheng have published a Law360 article that uses a new dataset to show how experts could potentially use data-driven quantitative methods to assess accounting materiality in accounting materiality disputes.

July 01, 2019
Brattle Economists Discuss the Standards for Evaluating Market-Making Behavior in OTC Markets

Brattle Senior Associate Sujay Dave and Principal Emeritus George Oldfield have coauthored a Law360 article that discusses the differences between exchanged-based and over-the-counter (OTC) market-maker practices, and why it is important for prosecutors to understand these differences.

October 24, 2018
Brattle Contributes to Agreement on Attorney's Fees in Facebook's Abandoned Share Reclassification Plan

On October 24, 2018, Facebook agreed to pay $68.7 million in attorney’s fees in connection to a shareholder lawsuit over the proposed reclassification of the company’s common stock that was canceled by Facebook’s board of directors last year.

August 24, 2018
Brattle's George Oldfield Publishes Article on Potential Role of Blockchain in 10b-5 Damages Cases

Brattle Principal George S. Oldfield co-authored an article for Law360 on the potential use of a blockchain-based recording system in solving 10b-5 damages allocation issues.

November 15, 2017
Matthew Aharonian to Present on The Knowledge's Group's Webinar on Securities Class Actions

Brattle Senior Associate Matthew Aharonian will participate on The Knowledge Group’s webinar, “Securities Class Actions: Trends & Developments in 2017 & Beyond,” taking place November 15, 2017 from 12-2 pm EST.

October 19, 2017
Torben Voetmann to Present at Practising Law Institute's (PLI's) Program on Finance for Lawyers and Other Professionals

Brattle Principal Torben Voetmann will present at Practising Law Institute’s (PLI) program, “Pocket MBA 2017: Finance for Lawyers and Other Professionals,” taking place October 19-20, 2017 in San Francisco, CA and via webcast.

September 25, 2017
Brattle Contributes to Shareholder Victory in Facebook Proposed Reclassification

On September 21, 2017 Facebook’s board of directors voted to abandon the pending reclassification of the company’s common stock.

June 13, 2017
Brattle Consultants to Present on Case Studies in Securities Litigation at BASF CLE Event

Brattle Principals Torben Voetmann and Ioannis Gkatzimas, and Senior Associate Pavitra Kumar will present at the Bar Association of San Francisco (BASF) Securities Litigation Section’s Continuing Legal Education (CLE) event, “Case Studies in Securities Litigation: What Works After Halliburton,” taking place June 13, 2017 in San Francisco, CA and via webcast.

March 15, 2017
Sujay Dave to Present Elements of Securities Litigations on The Knowledge Group's Webinar

Brattle Senior Associate Sujay Dave will present during The Knowledge Group’s webinar, “The Elements of Securities Litigation: Understanding the Basics,” taking place March 15, 2017 from 12-2 pm EST.

February 08, 2017
Torben Voetmann to Discuss Halliburton II and Fraud-on-the-Market Theory at The Knowledge Group's Webinar

Brattle Principal Torben Voetmann will present during The Knowledge Group’s webinar, “Halliburton II and Fraud-on-the-Market Theory: New Legal Challenges and Strategies Impacting Class Certification,” taking place February 8, 2017 from 12:00-2:00pm EST.

September 06, 2016
Matthew Aharonian to Discuss Halliburton II and the Price Impact Rule at The Knowledge Group's Webinar

Brattle Senior Associate Matthew Aharonian will present during The Knowledge Group’s webinar, “Halliburton II and the Price Impact Rule: Impact on Securities Class Actions,” taking place September 6, 2016 from 12:00-2:00 pm EST.

August 30, 2016
Paper by Torben Voetmann Investigates Bid-Ask Spread in Danish Stock Market

Brattle Principal Torben Voetmann recently authored a paper investigating the cost components of the bid-ask spread and the changes in the spread around earnings announcements on the small Danish stock market in the 1990s.

June 01, 2016
Torben Voetmann Authors Paper on Private Class Action Litigation Risk of Chinese Firms Listed in the U.S.

Brattle Principal Torben Voetmann has co-authored a paper published in the Quarterly Journal of Finance that analyzes the litigation risk of Chinese firms listed in the U.S.

May 27, 2016
Adoria Lim to Present and Torben Voetmann to Moderate at ABA's Western Regional CLE Program on Class Actions and Mass Torts

Brattle's Adoria Lim will present and Torben Voetmann will moderate at the American Bar Association’s (ABA) 3rd Annual Western Regional CLE Program on Class Actions and Mass Torts, which will take place at the Bar Association of San Francisco on May 27, 2016, at 2:00 pm – 3:00 pm PST.

April 20, 2016
Matthew Aharonian to Present Webinar on Halliburton II and the Price Impact Rule Decision

Brattle Senior Associate Matthew Aharonian will participate in The Knowledge Group’s webinar, “Halliburton II and the Price Impact Rule Decision: Then & Now,” taking place April 20, 2016 from 12:00 pm - 2:00 pm EST.

April 14, 2016
Torben Voetmann to Present on Class Actions at ABA Section of Litigation Annual Conference

Brattle Principal Torben Voetmann will present at the American Bar Association’s (ABA) 2016 Section of Litigation Annual Conference, taking place April 13-15, 2016 in Chicago, IL.

December 23, 2015
Brattle Economists Author Law360 Article Examining Methodology Findings in Halliburton Class Decision

Brattle Principals Torben Voetmann and Paul Hinton and Senior Associate Matthew Aharonian recently co-authored an article published on Law360, “Battle of the Experts: The Focus on Event Studies in Class Certification.”

November 10, 2015
Pavitra Kumar and Torben Voetmann Author Article on Event Studies in Securities Litigation

Brattle senior associate Pavitra Kumar and Brattle principal Torben Voetmann recently published an article in Event Study Tools, which illustrates the use of traditional and intraday event studies in securities litigation.

March 26, 2015
Paul Hinton and Pavitra Kumar Present at High-Frequency Trading Litigation Webinar

Brattle principal Paul Hinton and senior associate Pavitra Kumar recently presented in the webinar, “High-Frequency Trading Litigation in 2015,” hosted by The Knowledge Group on March 26, 2015 from 3:00 pm – 5:00 pm EST.

July 10, 2014
Michael Goldstein Quoted in Wall Street Journal Article on High-Frequency Trading

Brattle academic advisor Michael Goldstein, a Professor of Finance and Chair of the Finance Division at Babson College, was quoted in a recent Wall Street Journal article, “The Markets Unplugged."

June 27, 2014
Brattle Economists Co-Author Article Highlighting Complex Issues for Experts in High-Frequency Trading Litigation

Principal Torben Voetmann and senior associate Pavitra Kumar, along with Zachary Ziliak of Ziliak Law, have authored an article that discusses the complexities and challenges for experts arising from increased litigation surrounding high-frequency trading.