Key Trends in Federal Filings: An Excerpt from Securities Class Action Filings—2021 Midyear Assessment


Securities Class Action Filings—2021 Midyear Assessment

Executive Summary

Overall filing activity dropped considerably in the first half of 2021, falling to 112 filings from 150 filings in the second half of 2020. This decline was largely driven by a substantial reduction in the number of M&A class actions and federal and state 1933 Act filings, although core filings with Section 10(b) allegations were also down modestly.

Filings in the first half of 2021 were generally smaller, resulting in lower MDL and DDL indices. DDL fell 50% from $162 billion in 2020 H2 to $80 billion in 2021 H1. Similarly, MDL fell 64% from $991 billion in 2020 H2 to $361 billion in 2021 H1.

Special purpose acquisition company (SPAC) IPOs have continued to explode. Filings against SPAC-related entities increased sharply in the first half of 2021. There were also 10 filings related to COVID-19, largely concentrated in the first four months of the year.

Number and Size of Filings

Other Measures of Filing Intensity

Filings fell 25% in the first half of the year, largely driven by a 66% decline in M&A filing activity relative to the second half of 2020.

Figure 1 : Federal and State Semiannual Class Action Filings Summary

Key Trends in Federal Filings

Despite the substantial decrease in federal filings overall, there were twice as many federal SPAC filings in the first half of 2021 as there were in all of 2020. COVID-19 filings were largely concentrated in the first four months of 2021 and have declined since. 

Filings against non-U.S. companies fell dramatically from the record high in 2020. Only 16% of core federal filings were against non-U.S. issuers.

M&A Filings

SPAC Filings

Trend Cases

Non-U.S. Issuers

U.S. Issuers

By Industry

By Circuit

Combined Federal and State Filing Activity

In 2021 H1, federal M&A filings were just 12% of their total in all of 2020 and are on pace to be at their lowest level since 2014.

Number of Federal and State Filings

Total filing activity dropped 25% in 2021 H1 relative to 2020 H2, and was below the 1997–2020 average.

Securities Class Action Filings—2021 Midyear Assessment


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National Law Review, Volume XI, Number 209