Around the Legal World: Securities litigation in Japan on the Rise

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According to a new report published by NERA, economic consulting global firm, the total damages awarded against Japanese companies for errors in their financial statements increased four-fold to a record 45.9bn yen last year.

The economic analysts said the 2009 damages dwarfed the level recorded for 2008 – 9.9bn yen – and represented more than the total amount of securities litigation for the whole previous decade.

The reason for such increase was because a few particularly big cases were settled, which involved unusually large payouts.  According to Nera, there was little change in the number of cases settled in 2009 compared to 2008.

However, the report emphasizes an underlying trend: the number of securities law cases has been increasing since 2004, when the rules requiring a plaintiff to prove the extent of damages were eased and the powers of the market regulator, such as the Securities and Exchange Surveillance Commission, were increased.

Anna Timone (195 Posts)


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