SCA CLAIMS TOOL

The SCA Claims Tool is used to identify securities claim deficiencies and track maximum potential settlement value on filed claims that allege violations of Rule 10b-5 under the Exchange Act of 1934.  

SAR delivers more accurate estimates of potential securities class action (SCA) liability by relying on court-approved methodologies to estimate maximum potential settlement value on filed securities claims.  Our claim-specific empirical analyses serve to estimate and quantify unfavorable developments in the excess towers of a public company's D&O insurance program.  We provide qualified and independent results of event study analyses on all filed Exchange Act claims to identify econometric deficiencies, such as alleged stock drops that do not exhibit price impact or the use of unwarranted multi-day windows that may inflate alleged shareholder classwide damages.  We quantify maximum potential classwide damages and the value of potential settlement at each stage in the SCA life cycle after discounting for econometric deficiencies based on well-established case precedents in key circuits of the U.S. Federal Court system. 

Filed securities claims that do not allege any stock drops that surpass established statistical thresholds at the 95% confidence standard may not warrant class certification in Federal Court.  As a result, SAR presents maximum potential shareholder damages of zero on Rule 10b-5 Exchange Act claims that are substantiated by alleged corrective disclosures whose corresponding stock price do not exhibit a statistically significant single day residual return when the alleged material and corrective information was disseminated to participants in the market.

"When event studies reveal no statistically significant movement in a company's stock price at either the time that an alleged misstatement was made or the time when it was corrected, it is relatively straight forward to conclude that the alleged misstatement had no price impact." Supreme Court Brief for the United States as Amicus Curiae Supporting Neither Party in Goldman Sachs v. Arkansas Teachers Retirement System, et al. (2021) 

The applied statistical parameters that are used to compute estimates of the total maximum of potentially available aggregate damages abide by the standards of price impact as set forth in Erica P. John Fund, Inc. v. Halliburton Co., 309 F.R.D. 251, 269 (N.D. Tex. 2015).  The applied statistical and quantitative techniques that support each event study analysis to estimate the total maximum of potentially available aggregate damages exclude alleged corrective disclosures that do not exhibit price impact and do not warrant attribution to potential aggregate damages according to heightened pleading standards of loss causation (5th Cammer Factor) as set forth in Dura Pharmaceuticals, Inc. v. Broudo, No. 03-932, 2005 WL 885109 (U.S. April 19, 2005).  Alleged stock price declines that rectify alleged material misstatements or omissions and form the basis of the corresponding fraud-on-the-market allegations necessitate accurate and robust statistical and quantitative analyses at each phase of the class action life cycle to disqualify alleged stock drops that do not surpass statistical thresholds of transaction causation or price impact.  The Private Securities Litigation Reform Act of 1995 (PSLRA) and Rule 9(b) requires that Plaintiffs plead every element of a securities fraud claim with particularity.