By Mike Lange, Securities Litigation Counsel, Financial Recovery Technologies
In the Forex Antitrust litigation, on July 11, 2018, Class Counsel provided the Court with the following estimated settlement participation and projected recovery rates.
- Gross Settlement Fund: $2,310,275,000
- Estimated class-wide damages: $5,400,000,000 – $7,000,000,000
- Estimated Number of Class Members: 200,000
Estimated Settlement Participation
- Estimated Number of Class Members Submitting Claims: 60,000
- Estimated Participation Rate (by number of claimants): 30%
Projected Recovery Rate:
- Projected recovery rate (assuming 100% participation rate): 33%-43%
- Projected recovery rate (assuming 35% participation rate: 94%-123% **
** Participation rate is currently at 30%
Class members should take away at least three things from this data:
1. If you haven’t filed for Forex, FRT may still be able to help you file a late claim: The Class Counsel had estimated 200,000 class members. As of July 11, an estimated 60,000 class members had filed (resulting in a 30% participation rate). This means over 70% of class members have not filed.
If you have not filed a claim, FRT can work with you to file a late claim. The amount recovered could be significant as the class counsel is projecting the payout at ~100% of losses. To put this into perspective, most shareholder litigation settlements payout at 3-5% of losses.
2. If you have already filed a claim and selected Option 1, FRT can help you submit your full data (Option 2): The high expected payout rates means it’s likely worth the resource investment to gather and submit your full data under Option 2 if trade volumes under Option 1 appear less than actual levels.
As discussed in prior blogs, there are known data gaps and other reasons your transactions may not be captured under Option 1. As pioneers in Antitrust recovery, we are experts in querying and handling data to help you submit your full data for Option 2.
3. It’s worth implementing a system for filing claims in all eligible antitrust matters: Given the high-profile nature of the Forex litigation and the significant size of the settlement ($2.3 billion), we expected participation rates to be higher. The data above suggests that while many investors did not file for Forex for whatever reason, those that did will receive a significantly larger payout as a percentage of losses due to the low participation rate.
With another $850 million set to be distributed in the coming months, we expect the participation rates in less high-profile matters, including ISDAfix (July 16, 2018) and Euribor (August 1, 2018), will be similarly low, resulting in higher projected recovery rates.
For those questioning whether filing antitrust claims are “worth it,” the answer is yes. The expected high Forex recovery rates will likely take much wind out of the sails of direct action efforts which, despite much chatter to date, do not appear to have gained traction.
If you want to learn more about filing a late Forex claim or submitting your full data to maximize your recoveries, please reach out to your account manager or email us at firstname.lastname@example.org.
- July 11: Antitrust Class Action: The Road Ahead
- ISDAfix Case Update (June 2018): Settlements for the Remaining Five Defendants Have Received Preliminary Approval
- Case Spotlight (June 2018): Euribor Rate Manipulation
- May 10: What’s after FOREX? ISDAfix, Euribor, and several other antitrust class action settlements with money already in escrow
- Whitepaper: Antitrust – The Evolving Fiduciary Landscape
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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.
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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.