Securities class-action settlements reach 15-year high, but pace slowing

Securities class-action settlements in 2022 increased to 105, which was the highest number in 15 years, but the pace may now be slowing, according to research issued Thursday.

The total settlement value of $3.8 billion compared with 2021’s $1.9 billion, when there were 87 settlements, according to a report issued by San Francisco-based Cornerstone Research.

The median settlement amount of $13 billion was the highest since 2018, according to the report.

“The historically high number of settlements in 2022 can likely be explained by several factors, including a correspondingly high number of case filings between 2018 and 2020, when over 70% of the 2022 settled cases were filed,” said Laarni T. Bulan, a report coauthor, and principal at Cornerstone Research, in a statement.

Cornerstone said the increase in total settlement dollars also reflects eight mega settlements of at least $100 million, which ranged in size up to $809.5 million.

Cornerstone Research senior adviser and report coauthor Laura E. Simmons said in a statement, “As we look ahead, the latest trends in securities class-action filings suggest we may see a slowing in settlement activity, as well as some shifts in the focus of case allegations, such as towards cryptocurrency-related issues.”