The Private Securities Litigation Reform Act (PSLRA) of 1995 was enacted after much debate, a presidential veto, and congressional override. According to the Act's legislative history, many in Congress perceived that a group of "professional plaintiffs" and their regular counsel had come to dominate securities class actions with disastrous results. Frivolous "strike suits" were seen as burdening American business while meritorious actions were often compromised on terms that benefited lawyers but left defrauded investors without adequate compensation for their losses. The goal of the PSLRA was to eliminate abuses without eviscerating investor protections. Key among the PSLRA's reforms was a mechanism designed to encourage institutional investors - and in this context Congress specifically identified public pension funds - to take the lead role in monitoring and prosecuting securities class actions. CalPERS has a policy for monitoring securities litigation and determining when CalPERS should pursue a lead plaintiff role. CalPERS also considers other options in addition to pursuing the lead plaintiff role. For example, CalPERS may "opt out" of a class action and pursue its own case if CalPERS believes a better recovery can be achieved individually than through the class. In other circumstances, CalPERS may closely monitor the class action and seek to informally or formally influence the outcome of the litigation by conferring with lead plaintiff or filing formal objections or arguments in the case. CalPERS Viewpoint    Library    Governance Principles    Securities Litigation Contact Us    Guest Book    Search      News    Shareowner Forum Home      CalPERS On-Line    Meet CalPERS Board    Help ©2008 CalPERS. All rights reserved.