What is a lead plaintiff in a class action lawsuit?

By on January 8, 2013

A lead plaintiff is selected by a court to represent a group of members with similar claims in a class action lawsuit.  Lawyers for the lead plaintiff are usually chosen as lead counsel in the lawsuit and in charge of administrating the entire process of the litigation.

In a securities fraud lawsuit, a lead plaintiff must have specific qualifications in order to represent the class.  The lead plaintiff will need to do the following:

  • Acquired the security in order to participate in the litigation
  • Sustained a loss as a result of the fraud
  • Not accept any compensation for representing a class in addition to a pro rata share of any recovery, apart from expenses relating to the representation of the class.  In some circumstances, a court may reward the lead plaintiff with an additional monetary payment for spearheading the litigation.
  • Sign a certification that outlines these requirements.