Asset managers may have concerns about their investment personnel devoting time and attention to supporting a litigation rather than managing investments. How much ongoing involvement can investors expect if they join a shareholder litigation in Europe?
Simon Bushell: Institutional shareholders can participate as much or as little as they like in the management of the ongoing litigation. However, there must be an appropriate decision- making body and governance structure in place in any class action or group litigation. In very large cases that decision making body may represent several different claimant groups, which adds to the complexity. It is highly advisable to put this in place at the outset. This will help to avoid delays and other potential complications. There is of course a balance to strike between not being bogged down in the day to day management of the claim, and ceding control altogether. Key decisions such as settlement should be reserved to individual claimants.