Reinhart offers a unique independent securities litigation support service. We assist institutional investors in determining how to most effectively manage their rights to recover money through securities claims. Since Reinhart is not involved in bringing securities litigation cases, we do not have the potential conflicts present at other firms that combine securities claim review services with efforts to secure clients as plaintiffs. Reinhart has no interest in steering clients into unnecessary litigation in order to generate a large fee. Our goal is to add value by identifying cases and litigation strategies that will improve client recoveries, lower costs and deter future corporate fraud.
Policy Development
Most institutional investors adopt a securities litigation policy to guide their approach to securities litigation and identify criteria to be applied in evaluating specific cases. Reinhart regularly assists institutional investors in developing such policies and evaluating proposals from litigation counsel.
Sample Services
The securities litigation support services provided by Reinhart are designed to help clients identify those activities that will add to the bottom line and avoid actions that are unlikely to be cost-effective. For example, Reinhart can:
- Educate fiduciaries on class actions and corporate fraud litigation;
- Provide assistance in developing a litigation policy and claim recovery procedure
- Conduct outside manager and custodian contract reviews to determine consistency with the client's policy for management and filing of claims;
- Review class action claim filing procedures of the client's custodian (or other claims service provider) for reliability;
- Evaluate client claims and make recommendations in specific cases; including whether to file a separate case, seek lead plaintiff appointment, merely wait and file a settlement claim or actively monitor a class action;
- Seek other investors to support client involvement in specific cases, as appropriate;
- Assist in selection and retention of litigation or lead counsel in securities cases when needed;
- Supervise lead or litigation counsel where the client becomes an active litigant;
- Monitor and report on passively-managed class actions;
- Review case settlements and attorneys' fee requests and file objections when appropriate;
- Advise on when to join in filing amicus briefs or supporting declarations in securities cases; and
- Provide other custom services developed with the client to reduce litigation costs, increase recoveries, improve corporate governance, deter future losses or meet specific program needs.
Representative Independent Case Analyses
The following are actual examples of cases that Reinhart has reviewed for clients, usually in order to provide a "second opinion" after the client received recommendations from plaintiffs bar firms to file a lawsuit or seek appointment as a class action lead plaintiff:
- Based on a $22 million loss, we evaluated whether the client should seek appointment as lead plaintiff in a class action, file a separate case or take some other action. We determined that the client's primary claims were vulnerable to dismissal under the statute of limitations. It was recommended that the client remain a passive class member in the pending class action and later re-evaluate the case for a potential opt out case filing, after the statute of limitations issue was resolved in the class action;
- Based on a long-term holding of 200,000 shares in a company, we advised a client on whether to prosecute a derivative action seeking return to the company of $150 million in bonus payments gratuitously made to executives by a board they controlled. We recommended that the client join as a plaintiff in the litigation;
- After reviewing lead counsel's fee request in a class action, we recommended that our client object to a 25% fee as being above market rates. The fee request was subsequently dropped to 21%, saving the class over $17 million;
- In a case where our client had a $30 million loss, we determined that several other sophisticated institutional investors with a larger loss were going to separately seek appointment as lead plaintiffs. The client declined a plaintiffs bar law firm's request to become the lead plaintiff, and the same firm ended up being selected as lead counsel to the other investors. Our client was offered an unofficial monitoring role.