Tort Reform in the Securities Sector

The long drought in U.S. IPO exits ripples backwards up the food chain, discouraging investment in emerging growth companies and, consequently, threatening to eviscerate the tech economy ... our economic crown jewel since WW-II. A primary factor is growing distaste for public registration which invites plaintiffs' law firms to strong arm multi-million dollar settlements from boards, managers and shareholders. System reform is essential. This piece suggests shareholder consent to charter clauses providing class arbitration. The proposed system is fair both to plaintiff and defendant: cheaper; faster; SEC oversight; a level playing field; awards, if any, to aggrieved shareholders, not the lawyers.