The Opt-Out Lawsuit: Everyone's Doin' It!
The Wall Street Journal
Posted by Peter Lattman
Saturday, May 6, 2006
The Law Blog has posted before on the opt-out, the latest
headache for companies defending themselves from securities
class-action suits. Plaintiffs’ lawyers are increasingly
not signing on to settlements negotiated by other firms and
pursuing their own litigations instead.
Now opt-out lawsuits are piling up against Qwest
Communications, which already agreed to pay $400 million to
settle civil securities fraud allegations stemming from the
company’s alleged accounting fraud. Ironically, the lead
lawyer in the class action is none other than Lerach
Coughlin, which has been a trailblazer of the opt-out trend.
In recent weeks several investors, including New York State
Common Retirement Fund and the San Francisco Employees
Retirement System, have decided to file separate lawsuits
against Qwest and its former executives. Wall Street’s
taking notice: A Morgan Stanley telecom analyst expressed
concern over the opt-out lawsuits, writing that the raise
the risk “of higher legal expenses and settlements, and
could even threaten the proposed class-action settlement.”
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