Strike suit
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A strike suit is a lawsuit brought by a single person or group of people with the purpose of gaining a private settlement before going to court that would be less than the cost of the defendant's legal costs.[1] Such suits frequently appear where the defendant is a considerably larger entity than the plaintiff, such as a corporation or an estate.
[edit] Strike suits in Securities Law
Company shareholders sometimes use strike suits as a means of addressing perceived failures by or discontentment with the company while avoiding becoming embroiled in litigation themselves.
- A minor shareholder sues a company for falling short on projected earnings. The lawsuit makes multiple technical claims of incompetence by the company.
- A minor shareholder sues a company for failure to follow bylaws set by the company. The lawsuit makes multiple technical claims of bylaw infractions by the company.
[edit] References
- ^ Fox, Merritt B.. "Required Disclosure And Corporate Governance". Law And Contemporary Problems. http://www.law.duke.edu/shell/cite.pl?62+Law+&+Contemp.+Probs.+113+(Summer+1999). Retrieved 2008-10-15.
