Participating In Securities Collective Actions Outside the US: Are Adverse Costs Worth the Risk?

SEPTEMBER 12, 2023

One of the important considerations for investors participating in global securities collective actions is whether they may be at risk of paying costs to defendants in the event the investors lose the litigation. No one likes to lose, but the blow is softened if the consequences are relatively costless and investors are not on the hook to pay eye-gouging fees. Litigation funding can mitigate this “adverse cost” risk, but it may not eliminate it entirely. Each country also has their own rules regarding who pays, when, and for what, in the event claimants are unsuccessful. This paper explores the different ways certain jurisdictions outside of the US and Canada handle these adverse costs, and what investors should consider about the risk before deciding whether to participate in global opt-in litigation.

Start typing and press Enter to search