Leading pension funds agree on importance of securities litigation monitoring

Panel of industry experts review fiduciary duty to actively track global securities litigation for institutional investors

A panel comprised of past and present legal representatives from several leading U.S. pension funds, during a webinar hosted by Financial Recovery Technologies, LLC (FRT), emphasized that institutions have a strong fiduciary duty to actively track securities litigation, in the U.S. and across the globe. The expert panelists shared their funds’ experiences in being active participants in securities litigation. The discussion also addressed how funds should assess damages in order to make informed decisions about becoming active, what funds should consider before becoming active, and what impact being an active participant may have on an institution.

Securities litigation and resulting class actions represent both challenges and potential opportunities for institutional investors. While recovering damages caused by corporate financial malfeasance is beneficial to a fund, becoming actively involved in securities litigation can be a daunting experience.

Litigation monitoring involves tracking newly filed fraud complaints, assessing the potential impact on the fund and its investments, and deciding whether or not to take action. Increasingly, institutions are not only looking at securities litigation in the context of fiduciary duty, but seek a deeper understanding of their own recoverable damages in affected securities, in order to make wiser decisions about if and when to seek lead plaintiff status, or whether to opt out of the class to pursue a private action. Funds that take a proactive role in the litigation process can have a large impact on their assets and the investment community as a whole.

As discussed by the panelists, pension funds have several options for monitoring securities class litigation, including utilizing internal sources, relying on outside counsel who may not have the fund’s best interest in mind, or outsourcing to an impartial third party service.

“Monitoring securities litigation and evaluating whether or not to become an active participant is a standard of fiduciary responsibility for institutional investors,” said Kim Johnson, who served for more than a decade as General Counsel to the Louisiana and Colorado state pension funds. “Today’s discussion really highlighted how the use of unbiased and consistent evaluation can aid in meeting this standard.”

Download a replay of the webinar here. For a copy of FRT’s whitepaper that accompanies the webinar, click here.

About FRT

U.S. CLAIMS  I  GLOBAL GROUP LITIGATION  I  ANTITRUST  I  LITIGATION MONITORING  I  BUYOUTS

Founded in 2008, Financial Recovery Technologies (FRT) is the leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.

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