Speaking at a meeting of international litigators, Berman DeValerio Partner Joseph Tabacco, Jr. urged the European Union to offer defrauded investors a continent-wide forum for redress similar to that already afforded to victims of anticompetitive behavior.
Noting that the EU has been “very effective in attacking certain kinds of antitrust conduct” and “done a fantastic job of vigorous enforcement” in that area, Mr. Tabacco said a similar framework could be adopted to help investors recover money lost due to financial fraud.
“The tools are all there,” Mr. Tabacco said. “Obviously, the investors need the protections. And I do think there’s some precedent for that, again recognizing there would be a big, big push-back from the forces on the other side, the large corporations that would prefer to have the system remain the way it is.”
Mr. Tabacco made his remarks May 18 to lawyers from 15 countries at a meeting of the International Financial Litigation Network (IFLN), an association of law firms seeking to create a global litigation framework to promote legal security, transparency and market confidence.
Numerous speakers at the conference, held in Madrid, decried the general lack of a mechanism by which investors with similar claims against the same defendants could effectively sue as a group to recover money lost due to fraud. The problem is particularly acute in Spain, where a number of high-profile frauds have rocked the economy in recent years, with few investors receiving any compensation through the courts. The IFLN meeting was held in conjunction with the annual conference of the Spanish investors association, AEMEC.
He participated in an hour-long panel on U.S. Financial Litigation Issues with two other experienced U.S. litigators, Labaton Sucharow LLP Chairman Lawrence A. Sucharow and Robins Kaplan LLP Partner Stacey P. Slaughter. Richard Lorant, Berman DeValerio’s director of marketing and client relations, moderated the panel.
The panelists spoke about the need for effective group remedies for investors in jurisdictions outside the United States, especially since the Supreme Court in 2010 limited access to U.S. federal courts to only those investors who acquired stock on U.S. exchanges. While the panelists said the United States still offers aggrieved investors the best chance at recovery, they said a series of adverse developments made it more urgent for Europeans, Asians and others to develop their own remedies.
IFLN Conference organizers interview Berman DeValerio’s Joe Tabacco