New York - Private securities class-action lawsuits spiked 16 percent from 2003 to 2004, with aggregate settlements topping $5 billion - the largest amount on record, according to a securities litigation study by Big Four firm PricewaterhouseCoopers.
The study said that the mammoth amounts were anchored by partial settlements at companies such as WorldCom, which has thus far paid out $2.7 billion, followed by Raytheon ($510 million) and Bristol Myers ($300 million).
Excluding the partial WorldCom settlement, the average settlement value in 2004 was $26.6 million - up 18 percent over 2003, and 38 percent higher than the average settlement value of the 578 private securities class actions settled between 1996 and 2003.
PwC said that, on average, the number of private securities class actions filed in the U.S. was 188 per year from 1996 through 2003.
Defendant companies in the high technology and telecommunications sectors continue to be the most frequently sued.
In 2004, high technology concerns were involved in 30 percent of private securities litigation cases filed - a 15 percent rise from the prior year.
Other significant areas of private securities class actions were health services and pharmaceuticals, and banking and financial services.
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