TJ Cox: “I do think of Little Red Riding Hood. Do you remember when the wolf is licking his chops and so on? Here, it is not the…”

“I do think of Little Red Riding Hood. Do you remember when the wolf is licking his chops and so on? Here, it is not the investors that the wolf is worried about. The wolf wants to eat the investors. The stockholders here are being taken advantage of by lawyers who bring lawsuits for their own benefit, and that is what the 1995 Private Securities Litigation Reform Act was all about. There are a lot of these suits. There have been a lot of these suits. Over half of the top 150 companies in Silicon Valley alone were hit by such suits that were regulated by the 1995 Private Securities Regulation Reform Act. The enormous price that investors had to pay in these suits, according to one study, amounted on average to $9 million for each settlement. That comes out of the company, out of the investors' hides. But it goes to the lawyers. The plaintiffs, the supposed beneficiaries of this system, on average, received from these $9 million, on average, settlements between 6 cents and 14 cents on the dollar. That is why such a strong bipartisan majority of the House and the Senate have acted first to bring us the 1995 Private Securities Litigation Reform Act and now to bring us this very, very worthy legislation, the White-Eshoo Securities Litigation Uniform Standards Act of 1998.”