Securities class actions up in 2024, settlements total $4.1B

An increase in the filing of securities class actions and a record $4.1 billion in total settlements in 2024 could encourage plaintiffs attorneys to continue the trend this year, Woodruff Sawyer & Co. said in a report released Thursday.

The 206 cases filed in 2024 represented a 9% increase from 2023 and a 23% increase from 2022, the report said.

The average settlement for the 80 securities class actions resolved in 2024 was $53 million, up from $37 million in 2023. Tech companies paid $2 billion, nearly half of the reported yearly settlement amount; 56% of the settlements overall were for more than $20 million, the report said.

“Plaintiffs will be encouraged by the record-setting year of 2024 for settlement dollars and severity,” and the roughly 500 cases that were still open at the end of last year mean more high-dollar settlements are likely, the report said.

Shareholders filed fewer securities class actions against companies that had an initial public offering and special purpose acquisition companies. More high-profile, large-cap companies — such as AstraZeneca PLC, Boeing, CrowdStrike, Starbucks and UnitedHealth — faced securities class actions in 2024. Large-cap companies were the subject of 18% of the securities class actions filed last year.

The 34 securities class actions filed against companies headquartered outside the U.S. was a slight increase from the 28 filed in 2023, the report said.