http://overlawyered.com/2006/02/shareholder-suits-reach-new-high/?utm_source=rss&utm_medium=rss&utm_campaign=shareholder-suits-reach-new-high Chronicling the high cost of our legal system Sat, 26 May 2012 21:33:58 +0000 hourly 1 http://wordpress.org/?v=3.3.2 http://overlawyered.com/2006/02/shareholder-suits-reach-new-high/comment-page-1/#comment-2228 J.T. Wenting Thu, 16 Feb 2006 09:32:24 +0000 http://overlawyered.com/wpblog/?p=3111#comment-2228 If one or a small group of shareholders file against a company they have shares in they may well come out on top. Say total outstanding shares are worth $1 million, of which they claimants hold 1%. That's $10.000. Total loss due to the suit is 50% (extreme), or $5.000 for the claimant. But they get a quarter million or so, minus maybe $50.000 lawyer fees, for a total of $200.000. In the end they've won $190.000 tax free, something they'd need decades to earn from the shares themselves (and that taxed). If one or a small group of shareholders file against a company they have shares in they may well come out on top.
Say total outstanding shares are worth $1 million, of which they claimants hold 1%. That’s $10.000.
Total loss due to the suit is 50% (extreme), or $5.000 for the claimant.
But they get a quarter million or so, minus maybe $50.000 lawyer fees, for a total of $200.000.
In the end they’ve won $190.000 tax free, something they’d need decades to earn from the shares themselves (and that taxed).

]]> http://overlawyered.com/2006/02/shareholder-suits-reach-new-high/comment-page-1/#comment-2227 Dave Thu, 16 Feb 2006 00:11:52 +0000 http://overlawyered.com/wpblog/?p=3111#comment-2227 Yes, but what about where the shareholders are suing the directors. I think directors at the moment get a ridiculous free ride, they get fully insured and their interests are not aligned with the shareholders. Directors should be held accountable Yes, but what about where the shareholders are suing the directors. I think directors at the moment get a ridiculous free ride, they get fully insured and their interests are not aligned with the shareholders. Directors should be held accountable

]]> http://overlawyered.com/2006/02/shareholder-suits-reach-new-high/comment-page-1/#comment-2226 Dave Dufour Wed, 15 Feb 2006 21:52:43 +0000 http://overlawyered.com/wpblog/?p=3111#comment-2226 Of course these lawsuits are nutty. So are class action lawsuits. The common thread, besides nuttiness, is that the only ones who are enriched are the attorneys. How 'bout that? Of course these lawsuits are nutty. So are class action lawsuits. The common thread, besides nuttiness, is that the only ones who are enriched are the attorneys. How ’bout that?

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