A federal magistrate judge’s rejection of a lead plaintiff bid in a proposed securities class action against Credit Suisse Group AG highlights how courts decide if an investor is right for the role.
The judge found Credit Suisse investor Yasni Jimenez wouldn’t adequately represent a proposed class alleging the bank made false and misleading statements about its practice of lending money to Russian oligarchs. Jimenez, who estimated losing $621, was the only investor who requested to be lead plaintiff.
Jimenez argued the judge didn’t have the power to reject his request because he was the only candidate for lead plaintiff. The decision highlights other unsettled questions about how judges assess whether an investor should assume the role. It’s unclear how much certain considerations, like the size of losses or attorneys’ fees arrangements, should factor in when no one else is vying for the lead position.
‘Enforcement 40’ for 2020
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